BY JOHN ECKBERG
The Cincinnati Enquirer
America is in the twilight hours before the dawning of a new entrepreneurial day, but electronic commerce expert Cathy Neuman isn't reaching for her sunglasses anytime soon.
"I think what you are going to see are new businesses and new business ideas cropping up and being implemented with high capitalization and no profit. It is the first time this has happened in a long, long time," Ms. Neuman said.
As partner in charge of electronic business for PricewaterhouseCoopers, a global consulting firm, Ms. Neuman said there are few clouds on that e-commerce horizon.
Her comments came prior to a trip to Cincinnati and a speech to an invitation-only group of local executives planned for Wednesday morning at the Bankers Club about the implications of electronic commerce for Joe Coffeemug and Main Street USA.
"We are in an entrepreneurial dreamland right now," she said.
$20B this year
The global consulting firm has crunched numbers about how commerce on the Internet is going to grow and has come to conclusions that are probably passe by now.
"We estimate that the current transaction value over the
Internet in 1998 will be $20 billion, and there will be an exponential increase in terms of transactional dollar value in the future," she said.
"An increase of 1,500 percent is the most conservative estimate -- about $300 billion spent over the Internet in North America and Europe by 2002. The outskirts number is $1.5 trillion (spent annually) by 2002."
Whatever the real number ends up being, one conclusion is unavoidable: there's some jingle linked to Internet commerce, and it's only going to grow.
Implications are already being felt.
"It is fair to say that most of the companies now are at the strategy level," she said.
"CEOs are looking and trying to figure out what to do. They are scared to death that they are going to miss it, but they are not willing to get too far out on the limb."
Firms always open
One dynamic likely to change is that with the Internet, a company never has to close its doors.
"With electronic business, you are in business 24-by-7, and that is a really big deal," Ms. Neuman said. "People can buy something any time. It will enhance customer loyalty -- retaining customers will be easier."
The Internet already has altered the human resources divisions of most companies with resumes arriving through Web sites, and many companies shift paperwork like expense reports to online avenues.
Inevitably, traditional sales channels will change, she said. Mass layoffs because buyers and sellers are now only a click away from a product? Is this going to lead to the obsolescence of a sales force?
Not likely.
"There will be a streamlining of business processes," Ms. Neuman said. "The sales and channel distribution models will change. The question is: Will it shrink? I don't know if I would paint a world where we will never need salespeople, where we will never need a store again.
"There will be businesses reinventing themselves though in ways that folks never thought of before."
John Eckberg covers small-business news for The Enquirer. Call him at 768-8386 or e-mail him at jeckberg@enquirer.com.
