E-commerce Business In Saudi Arabia | EssayIvy.com

E-commerce business in saudi arabia

E-commerce Business in Saudi Arabia 1
E-COMMERCE BUSINESS IN SAUDI ARABIA
Course
Professor’s Name
Institution
City, State
Date
E-commerce Business in Saudi Arabia 2
E-COMMERCE BUSINESS IN SAUDI ARABIA
About the Business
The name of the company to be introduced in Saudi Arabia is SaudiMat™, which shall
be an online retailer specializing in a wide range of retail products, including electronics,
apparel, footwear, furniture, sporting equipment, groceries, food, and cosmetic products among
others. The corporation shall have its main store in Riyadh with other stores located in the
different major cities of the Kingdom. Its vision statement is to touch the lives of millions of
people through offering the highest quality services and products to clients at the most
affordable prices. In addition, the mission statement of the organization is to be a regional
leader in retailing e-commerce and one-stop-shopping choice for everyone. The business
statement that shall drive the organization towards the realization of the identified vision and
mission statements is ‘good is never the best.
E-commerce Business in Saudi Arabia 3
Description of the Processes of SaudiMat™
The organization shall operate through the business-to-consumer model of e-commerce.
This model means that the corporation shall be retailing its products directly to its clients
(Morris, Schindehutte, & Allen, 2005). Clients would have an opportunity to view products
offered for sale directly and place their orders, which would then be processed by the company
staff for delivery within the shortest time possible. The choice of this business model is the fact
that it allows the company to interact directly with its clients, which could be useful in
determining their preferences through market surveys (Morris, Schindehutte, & Allen, 2005).
The fact that the organization shall operate using the business-to-customer model suggests that it
would deliver customer-oriented services and products that place the highest significance on the
role of the customer in its overall success. Figure 1 indicates the business-to-client model that the
company shall adopt.
Figure 1: the business-to-customer model of e-commerce that SaudiMat™ shall adopt
SWOT Analysis of the Business
The SWOT analysis is a tool used in the assessment of the internal environment of an
organization according to its strengths, opportunities, weaknesses, and threats. Companies
E-commerce Business in Saudi Arabia 4
always use their strengths and opportunities as the most significant factors influencing their
operations. Specifically, the two elements are used to compensate the weaknesses and threats
that are undesirable for effective operations on any organization. Table 1 indicates a SWOT
analysis of SaudiMat™
Strengths
The company has diversified its nature of
products, which means that it offers a wide
range of products from which clients can
choose to carter for their tastes and
preferences
The organization’s adoption of the e-
commerce model indicates that it would
have an access to a large customer base
within a short time compared to the
benefits it would have driven from
conventional approach to business
The company has a team of dedicated
human resources who would increase
customer satisfaction through the delivery
of high-quality services
The mission and vision statements of the
company mean that it only provides
customer-oriented services, which is a
source of competitive advantage
The organization has a huge capital base
that it may use to enter the market by
taking on considerable risks for higher
returns
Weaknesses
The organization does not have a
strong brand equity for the fact
that it is a start-up business
The organization does not have
significant experience in e-
commerce, which means that it
might compare negatively against
its competitors
The organization does not have a
strong supplier network, which
would ensure sufficient supplies
of products for stocking
Opportunities
The organization has the chance of
benefiting from the growing popularity of
e-commerce in the Gulf region, especially
in Saudi Arabia to grow the volume of its
ventures
The socio-economic transformations in the
country are favorable for businesses of the
nature of SaudiMat™, which suggests that
the company would be welcomed into the
market effectively
The relatively stable and growing economy
of the Kingdom of Saudi Arabia suggests
Threats
The retail industry is one of the
most competitive in the world
and in Saudi Arabia, which
suggests that the business might
fail to enter the market effectively
(Moatti et al., 2015)
Unfavorable weather conditions
suggest that the company might
have issues competing with more
established brands for limited
suppliers in its groceries line of
business
E-commerce Business in Saudi Arabia 5
that the business has an opportunity to
grow within the shortest time possible
A supportive political environment for
entrepreneurship suggests that the
organization is likely to meet with only a
few challenges that would threaten its
success.
Table 1: SWOT analysis of SaudiMat
The SaudiMat™ Website
The website of the company will have an interactive platform that would welcome clients
to the organization. Specifically, the corporation shall utilize its corporate website as one of the
tools that would market its products. The site shall have a section bearing information
concerning the organization. Form this menu on the firm, visitors will have an access to the
history of the organization, the transformations it has undertaken along the way and projections
of growth that it aspires. The section shall also contain the vision and mission statements of the
organization, including its corporate social responsibility statement and strategy. The second
menu on the login screen of the corporate website of the institution shall be the different
departments grouped according to the line of business that the clients might want to purchase
such as grocery, furniture, food, and the rest. Under each menu on the line of products’ list, a
visitor would find from the drop-down lists varieties of products and brands that the business
avails for sale. The drop-down lists would be useful for the organization in communicating to
clients the variety of products and services that the organization offers to them.
Since the organization delivers its services with the interests of the clients at heart, there
shall be a special section for visitors to login to the site. Login to the site is special for customers
and the organization alike since it provides them a chance to place their orders and make their
payments. The login area of the website shall be adjacent to the contact information of the
E-commerce Business in Saudi Arabia 6
organization that shall allow interest clients to make inquiries of their choice. The website’s
contact information area shall include a toll-free number that clients in Saudi Arabia can reach
the customer support team, an e-mail address, and social media pages for clients who would like
to find more about the products and services offered for sale.
There shall also be a place on the website that will allow clients to search for what they
would like to purchase from the business in the event that they do not understand the categories
into which such products fall. Since the website shall be in Arabic, it shall have a place that
allows non-Arabic visitors to translate the language into more than fifteen languages, including
English, French, Chinese, Japanese, and other popular languages. The website shall also be as
informative as possible to help clients find value for their money through running interactive
pages that indicate the best offers concerning promotions, discounts, new arrivals, the stores near
clients, and any other information that would be relevant for the improvement of customer
experience while shopping with SaudiMart™. Figure 2 indicates the website layout of
SaudiMat™.
E-commerce Business in Saudi Arabia 7
Figure 2: the website layout of SaudiMat™. This section shows a section of the website dealing with footwear that
the company shall sell under the Love the Shoes You Wear brand name.
System Design
E-commerce Business in Saudi Arabia 8
Figure 3 shows the architecture of the website that the organization shall use to provide
its products for sale to clients. According to the figure, the company shall require to
communicate with its clients through the internet even while it shall have the traditional brick
and mortar stores in Riyadh and the rest of the major cities around Saudi Arabia. For this reason,
the business-to-customer network architecture shall be the merchant model. The role of the
website in this case shall be to supplement marketing and selling strategies of the organization,
especially to reach persons who cannot access the physical stores (Laudon & Traver, 2013).
The basis architecture, as figure 3 shows, shall include software and hardware
components. The hardware components of the organization shall be located within the physical
premises of the organization and shall be installed with software for communicating with cloud-
based resources that shall be hosted by Microsoft
®
off the organization’s premises. Customers
will be able to communicate with the organization through the cloud, which would ensure that
the website runs at all times and that the clients can access information at their convenience
using any of their preferred devices. This idea implies that the organization shall use the
Software-as-Service model of cloud computing.
Figure 3: the network architecture of the organization
E-commerce Business in Saudi Arabia 9
The advantage of using this type of cloud computing architecture is the fact that it does
not charge clients for the installation and maintenance costs of the software. Since the software
resources on the cloud are shared between the organization and all its customers the world over,
the organization is likely to realize cost-effectiveness in operating its corporate website (Laudon
& Traver, 2013). The company will have another advantage of communicating directly with its
clients, which is a further advantage in the developing of a competitive advantage.
The Needed Software and Hardware for the Corporate Website
Table 1 indicates the types of hardware and software required to run the website and the
rationale given. The organization has an option of obtaining the different network components
from the numerous vendors in the market.
Component
Software
Web Servers and
backup servers
E-commerce Business in Saudi Arabia 10
CRM Software
Firewall
Hardware
Computers
E-commerce Business in Saudi Arabia 11
Printers
Table 1: Hardware and Software requirements for the corporate website
Security Issues and How the Company Should Avoid Them
Operating an online business demands significant considerations for security issues
related to the nature of such activities. For instance, the organization should beware of internal
and external security breaches that would affect the smoothness of its operations. Internally,
some employees of the organization might handle information inappropriately, such as leaking
high-profile information to competitors or using personal information of clients irresponsibly
(Turban et al., 2002). For this reason, it would be critical for the organization to first develop an
IT usage policy that would define what activities the workers should and those they should not
do in the dealing with IT resources. In ensuring that the authorized individuals only handle
critical information, the organization shall institute security measures such securing the hardware
devices using passwords and other security features that would guard against irresponsible use of
data.
The firm also faces possible security breaches from the external environment, which
might be perpetrated by hackers. These people might attack the cloud through which the
organization communicates with its clients. The channel provides an easy way of attacking the
network hardware on the corporate premises. Hackers might target critical information related to
customers and the company. Therefore, it would be useful to secure the network with appropriate
firewalls that would detect and prevent the possibilities of unwanted intrusions into the system.
Marketing and Advertising Strategy for the Organization
E-commerce Business in Saudi Arabia 12
The company shall target consumers from all the demographic groups within Saudi
Arabia and the rest of the world. The reason for this idea is the fact that the organization stocks
products from a wide base of consumer bases irrespective of age, economic, gender, and
economic status. Because of the effect of technologies and their relative preference among
individuals from different demographic groups, the organization shall adopt different marketing
strategies for different groups. For instance, online marketing strategies, such as social media,
shall be adopted to target the younger generation of clients who have been found to have higher
levels of preference for such technologies (Lenhart et al., 2010). Contrarily, the traditional
promotion methods, including print and visual advertising through newspaper and television
shall be adopted to capture the older clients. The organization shall also use targeted marketing
approaches in which it shall send special printed regalia to groups of customers in whom it has
special interests, such as the aged, those with specific medical conditions, and others.
Ethical and Legal Considerations
The company shall operate within the legal frameworks of the Kingdom of Saudi Arabia
concerning commerce. These laws also carry an ethical obligation for the organization to the
socially responsible to the community that it serves through avoiding false advertising and
misleading information concerning products. The website should also hinder the accessibility of
personal information belonging to other clients while using the website.
Conclusion
SaudiMat™, an online retailer specializing in a wide range of retail products, including
electronics, apparel, footwear, furniture, sporting equipment, groceries, food, and cosmetic
products shall be headquartered in Riyadh, Saudi Arabia. The organization shall operate a
business-to-customer network architecture that will allow it to interact directly with its customers
E-commerce Business in Saudi Arabia 13
using the Software-as-Service model that would reduce the costs of operating the website while
ensuring stability in service delivery. The organization shall install appropriate security software
to protect the hardware and software resources provisioned over the cloud to avoid possible
security breaches. It is expected that using this approach, the organization would enter the market
aggressively and build its brand reputation even in the wake of stiff competition from established
organizations. However, the institution shall consider the legal and ethical issues that tie it to
responsible advertising and use of critical data.
E-commerce Business in Saudi Arabia 14
References
Content Writer (2013). Technologies required for E-commerce. Retrieved 2 April 2018, from
http://www.contentedwriter.com/describe-the-technologies-required-for-e-commerce/
Laudon, K. C., & Traver, C. G. (2013). E-commerce. Pearson. New York: NY
Lenhart, A., Purcell, K., Smith, A., & Zickuhr, K. (2010). Social Media & Mobile Internet Use
among Teens and Young Adults. Millennials. Pew internet & American life project.
Moatti, V., Ren, C. R., Anand, J., & Dussauge, P. (2015). Disentangling the performance effects
of efficiency and bargaining power in horizontal growth strategies: An empirical
investigation in the global retail industry. Strategic Management Journal, 36(5), 745-757.
Morris, M., Schindehutte, M., & Allen, J. (2005). The entrepreneur's business model: toward a
unified perspective. Journal of Business Research, 58(6), 726-735.
Turban, E., King, D., Lee, J., & Viehland, D. (2002). Electronic commerce: A managerial
perspective 2002. Prentice Hall: ISBN 0, 13(975285), 4.

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