The Impacts of Electronic Commerce on International Trade of Small and Medium Size Enterprises in China                                 Contents List Executive Summary Introduction to the study The literature review Research methodology Discussion Result analysis  Conclusion and Recommendation Reflection References                                   Executive Summary In the process of transition to the information economy world, the traditional business has been unable to meet the trade environment under the current conditions because of its many drawbacks. As a direct result of the growing maturity of Internet technology, e-commerce is a new direction for future business development. Electronic Commerce is a new business model with automatic data exchange and online transactions as the main content. E-commerce has different characteristics, such as openness, globality, regionality, low cost, and high efficiency. While meeting the inherent requirements of the commercial economy, it also transcends the value of being a new form of trade. E-Commerce not only changes the production, management, and management of the enterprise itself but also has an impact on the traditional trade methods. Increasing trade opportunities, reducing trade costs, and improving trade efficiency are the most obvious signs. While e-commerce is driving economic structural change, it has produced enormous and far-reaching effects on the entire modern economy. This paper introduced the meaning of e-commerce. Then, this paper elaborated and analyzed the application of e-commerce to increase revenue in the field of international trade and discussed the impact of e-commerce on international business in Small and Medium Enterprises in China.  

 

 

1.    Introduction

1.1 Introduction This section covered the background of the study, objectives of the study, significance of the study research, definition of international trade, and e-commerce. 1.2 Background of the Research After entering the 21st century, the emergence and development of e-commerce has brightened our eyes. It affects the traditional behaviors and ways of thinking of the masses, and adds more vitality to the world. Under the background of global economic integration and stiff competition, e-commerce integrates computer technology, network technology and information technology into one, which will become the main mode of international trade in the 21st century and the engine of economic growth in the new century (Terzi, 2011).With the advent of the information age, there is no specific time and space barrier. Trade can also take place anywhere, anytime, and every country pays more and more attention to e-commerce. Studying and discussing the status of e-commerce and formulating corresponding e-commerce policies are urgent problems to be solved.   Van (2003) pointed that the development of trade must be based on production activities. The power of productivity and the richness of materials will make trade activities more prosperous. From small-scale trade to large-scale trade to national trade to international trade, this is the development of productivity and technology. Nowadays, international trade is already the top priority of commodity trade. Traditional trade methods have many inconveniences: Poor information exchange, low cargo transport capacity and poor resilience are the shortcomings of traditional trade. But with the development of electronic computers and the arrival of the information age, international trade has entered a new era. At the same time, the emergence of e-commerce between different countries, that is to say, countries have launched e-commerce (Weinstein, 2005). In the current world, electronic Commerce is a prevalent method for a business to use in international exchange. E-commerce development has dramatically influenced the international trade environment in China. In global economic integration and fierce competition, e-commerce integrates computer, network, and information technology into one. Which will become the primary mode of international trade in the 21st century and the engine of economic growth in the new century? In China, small and medium enterprises have adopted E-commerce so that they can gain a competitive advantage in international trade and also expand their markets (Chan, 2017). Due to economic globalization, the growth of electronic Commerce has a significant influence on the international exchange environment. It has greatly influenced China's economic climate in all aspect of world trade. In China, most of the firms are small and medium enterprises; they are forced to adapt to international trade in the environment of globalization. Through the adoption of international trade, they are able to overcome various barriers and also embrace competence in the world. However, the various issues of applying e-commerce in international trade must be taken seriously. The country's informatization and information capabilities are low, the overall level of enterprise informatization is low, and the use of e-commerce is lacking in the development of trade. Nowadays, the e-commerce awareness of many small and medium-sized enterprises is not enough; the e-commerce transaction environment is not good, and many transaction links are out of touch. These problems have produced a significant impact on the development of international trade. Small and Medium enterprises cannot take advantage of electronic Commerce and avoid e-commerce risks. With adequate research, we are able to understand the effects e-commerce has on small and medium enterprises in international trade. 1.3 General Objective of the Research This paper aims to explore the various effects of e-commerce on the Chinese SMEs and find out the internal connection between these impacts and their influencing factors as well as propose measures that can reduce the adverse effects on China’s e-commerce trade in order to promote e-commerce development in China; improve the economic benefits of e-commerce on SMEs; strengthen the relationship between China and other countries; maintain the international relationship with other countries; and promote the economic development of China. The impact of e-commerce on Chinese SMEs will be identified by defining e-commerce, international trade and discussing its development in China.   1.4 Significance of the Study First, through the application of e-commerce in international trade, it is of considerable importance for us to fully understand the critical position and far-reaching influence of e-commerce in international trade. Carry out international trade and use e-commerce to have the incomparable advantages of traditional foreign trade. Traditional trade methods involve buyers and sellers, customs, banks, taxation, commodity inspection, transportation, multiple links, complex operations, and long-term inefficiency. International e-commerce transfers some of its business to the Internet. Therefore, combining the development situation of the Internet era, analyzing the decisive role of international trade in the e-commerce environment, which will further save human resources and material resources, reduce the restrictions on time and place of international trade, and help promote the advancement of the national economy. Secondly, studying all aspects of e-commerce, analyzing overseas trade from various angles, allowing us to discover problems and solve problems, we need to sum up the experience in practice. Slow and steady development is safe development (Acharya, 2016). We do not need abnormal growth; some issues need to be resolved promptly in the event. Third, the field application and theory of e-commerce are still different. We should analyze this issue and formulate corresponding development strategies and guidelines. E-commerce and physical Commerce are quite different. Entity commerce generally occurs in the real environment, with high reliability and timely dispute resolution. The virtual nature of e-commerce brings some convenience and is accompanied by some problems. E-commerce makes trade spread across time and geography, greatly facilitating and facilitating trade. But this great flexibility poses specific challenges for consumers and regulation. For consumers, once a trade dispute occurs, consumers are in a passive position, spending time and energy to deal with such problems.  Third, the field application and theory of e-commerce are still different. We should analyze this issue and formulate corresponding development strategies and guidelines. E-commerce and physical commerce are quite different. Entity commerce generally occurs in the real environment, with high reliability and convenient dispute resolution. The virtual nature of e-commerce brings some convenience and is accompanied by some problems. E-commerce makes trade spread across time and geography, greatly facilitating and facilitating trade. But this great flexibility poses certain challenges for consumers and regulation. For consumers, once a trade dispute occurs, consumers are in a passive position, spending time and energy to deal with. Supervision also faces many problems. Therefore, the state needs to develop a series of policies and regulations to limit these problems. Overall, since the 21st century, with the rapid development of information technology, e-commerce has gradually emerged. In the context of economic globalization, countries strongly support their trade. Various policy support has been introduced. Great prosperity for economic and trade exchanges. Study some problems in e-commerce and international trade, and draw some high-feasibility and guiding conclusions to guide the development of international trade and help deal with the impact of e-commerce. These have great practical significance.                                                         

1. 2.    The literature review

2.0 Introduction This chapter focused on the evaluation of theoretical literature, empirical analysis, and evaluation of critical research. 2.1 Overview of E-Commerce and International Trade 2.1.1 Electronic Commerce E-commerce is the use of electronic devices for commercial trade. Now mainly refers to the use of the Internet for trade activities. In the 21st century, electronic information is developing rapidly. E-commerce relies on the development of electronic information and conducts trade activities on the Internet, which significantly enriches the means of and creates excellent economic benefits and industry vitality. Online shopping using the Internet, computers, and mobile phones is e-commerce. It depends on the growth of network technology and electronic technology (Chan, 2019).  E-commerce is not just about using the Internet for business communication but also using the network to assist in running a business. E-commerce can also include overseas trade. E-commerce in the field of foreign exchange refers to the completion of any form of marketing by electronic parties, not by paper documents, through automated information technology, internetworking technology, and modern communication technology. Its principal activities include online business and product display, online ordering, and online payment (Zhao & Zhang, 2014). On E-commerce, different electronic payments include the use of credit and Debit cards, PayPal, E-wallets, Bank Transfers, and more. E-commerce is used to conduct business with people who are far away, including various auxiliary agencies and participating people, intermediaries related to business dealings, producers, consumers, and so on. The World Trade Organization defines e-commerce for commercial activities, including suppliers, customers, governments, and other electronic devices of other participants. Such as electronic data exchange, email, web technology, and additional business information structure, and complete the management and operation of various negotiations, management activities, and consumer activities.     2.1.2 International Trade International trade is also known as foreign trade is a form of trade between two or more countries. It entails the exchange of goods and services between individuals, governments, organizations, or between private organizations and government, individuals, and organizations located in different countries. When goods supplied from one country to another, this form of trade is referred to as export trade. The purchase of products from another country is known as import trade. Some of the reason countries engage in international business include, uneven distribution of resources, differences in nature, culture, and skills and also a difference in product cost due to climate changes in different countries ("Analysis of certain types of frequently used export promotion schemes," 2009). Categories of international trade consist of a visible business where tangible goods are imported or exported. Export trade, import trade, bilateral trade, which is trade between two countries and multilateral deal which involves trade among many nations. With the development of international trade and the increase of globalization of finance regulations, people's way of understanding the role of international trade is also deepening. We have a deeper understanding of economic growth driven by international trade, raising consumption levels, and enhancing national welfare (Terzi N, 2011). The development of international trade will unpreventably lead to the growth of the market, which will help to stimulate economic growth. The market competition mechanism will fully play its role. It will necessarily encourage the renovation mechanism of enterprises and encourage technological growth, thus fostering the growth of the economy, which will bring about personnel exchanges. The advancement of culture and the advancement of ideas will have a great effect on the cultural, social, and political improvement of a country, which in turn will promote economic reinforcement. 2.2 Theoretical Review 2.2.1 Classical Theory The classical theory of international trade was discovered with a perspective to its providence of guidance on questions regarding the national policy. It consisted of a descriptive analysis of the economic activity and the phenomena to be studied the problem to be solved is done regarding the current interest of the public. The classical economist in international trade was mostly concerned with answering two questions. The first question was in the production; the type of product a country would specialize in or which product a country would export and import. The second question was, what would be the ratio of exchange when different countries produce different goods. The classical theory gives the following answers. Each country will specialize in the production of goods that are suitable for the country. Production will be concerning the quality of the country's soil and other natural resources, its climate, the capacities of its people, and the capital that it possesses (Yaury, 2019). The state will put more effort into the production of such goods. It will produce more than it needs for exchanging with other countries against products which it cannot deliver, or it is less suited. This theory is based on labor cost theory of value which state that goods are exchanged against either depending on the amount of labor invested in them. This answers the second question that the labor costs determine the exchange prices. 2.2.2 Modern Theory of International Trade This theory has replaced the traditional comparative cost theory and was put forward by a Swedish economist known as Bertil Ohlin( Van C, 2012). This theory state that countries in the international trade specialist in the production of products which they have a comparative advantage based on land, capital, and labor, which are the factors of endowments. According to this theory, international trade is as a result of differences in prices of commodities; hence, individuals or organizations purchase goods outside the country because it is cheaper. By establishing the exchange rate between two countries, helps in the comparison of product prices in both countries (Shen, 2012). 2.3 The relationship between e-commerce and international trade With the advent of globalization, international trade is becoming an increasingly popular form of acceptance. As a means, e-commerce has shown unstoppable development momentum, especially the Internet, since it has been applied in the field of trade, especially in the field of international trade. E-commerce creates conditions and paves the way for companies of all sizes and makes trade and information exchange between companies easier and more convenient. 2.3.1 The impact of e-commerce development on trade E-commerce is a new type of trade that is accompanied by the popularity of the Internet, making online transaction negotiations, signing contracts, customs declaration, inspection, insurance, transportation, and settlement of foreign exchange possible. E-commerce has broken through the traditional trade mode of single-item logistics, realizing the three-in-one integration of online goods, information and currency, and lifting the problems of material, time, space and payment in traditional trade activities. The traditional way of trading has had a strong impact. 2.3.2 The application of e-commerce in international trade First, release of trading information- The traditional way of selling seller information is mainly through the trade fair or the advertisement of paper media. This method has the disadvantages of large geographical limitations, short timeliness, limited audience and lack of pertinence. The Internet-based B2B enterprise-to-business business uses the information of buyers and sellers to be put on the portal website, directly realizes the docking of the cooperation intentions of both parties, reduces the intermediary program, and makes the release of business information more efficient. Second, contract fulfillment- The process of contract performance is the most complicated, including stocking, commodity inspection, transportation, document processing, insurance and customs declaration, handling export licenses and export tax rebates. In traditional international trade, this is the stage with the most various paper documents and the most complicated business. Therefore, in the process of electronic trade internationalization, it is also the area where the e-commerce system plays the most space. Third, technology trade and service trade- In these non-goods international trades, due to the special nature of commodities, the space for the use of e-commerce is enormous. Taking international technology trade as an example, through the use of multimedia technology and virtual reality technology, all trade processes, including the transfer of goods, can be almost completely done online, which saves the cost of technology trade and improves the overall trade efficiency. In retrospect, the use of e-commerce eases the process of doing trade by making it faster and less expensive. 2.3.3 The influence of e-commerce on traditional international trade mode and the application of trade intermediaries to e-commerce Today, e-commerce has become a significant means for countries to conduct foreign trade. At the same time, it also strongly impacts the traditional trade model. The emergence and application of e-commerce have brought up a new way for the viable enlargement of international trade. E-commerce has brought new zeal and vitality to the economy, both in terms of cost and efficiency. It represents informatization and the future trend of business development. Scholars from various countries have conducted different degrees of research on the application of e-commerce in international trade. For e-commerce, different fields and even different experts have different views and opinions. Catherine, L (2000) pointed out that e-commerce can improve domestic economic welfare on the Internet and its related activities. It is thereby promoting domestic service trade liberalization and more rapid integration into global production and leapfrogging technology. E-commerce integrates local and global markets. From the outset, it needs critical internal policy support in the negotiation of trade issues related to e-commerce, especially in the fields of telecommunications, financial services, and distribution. The problems of e-commerce technology are its complex nature. Network externalities can change the way developing countries negotiate externally, making them more dependent on the way they cooperate. Second, because e-commerce is characterized by "network externalities," developing countries should use this technology to lead more advanced sectors. In developed countries, e-commerce is not supported by the service sector, but by two or even more. The Organization for Economic Co-operation and Development (OECD) believes that e-commerce is a business that sells goods and services over the Internet for offline or online transactions. In a more convincing definition, e-commerce represents the exchange of products and services from two or more parties using electronic instruments and technologies. At present, e-commerce has become an essential part of economic development, especially developed countries, and promotes politics. In developing countries, it is also gradually becoming a necessary part of international trade. Arturo (2012) believes that e-commerce is the rearrangement of geopolitical centers and the rise of new economic actors, such as China and the BRIC countries. Ecommerce is the essential structural change in economic, political, and social action, and it is also the beginning of a new cycle. The road to economics has been re-paved, and economic globalization itself is beyond the existence of the state. Since the beginning of the 21st century, many researchers have proposed the impact of e-commerce on the traditional international trade theory. Li (2011) illustrates the rapid development of e-commerce, which has brought unprecedented challenges to international trade and provided scarce opportunities for growth. The operating environment of international trade will change, the business process of international trade will change, and the way of competition in international trade will be different. Fourth, Fourth, promote small and medium-sized enterprises to enter the global market better. Dou (2011) pointed out that the application of e-commerce has dramatically reduced the cost of international trade, which helps to improve the efficiency of foreign trade. The development of e-commerce has brought about new changes in the global market environment, which is conducive to promoting innovation in business management. The application of e-commerce is helpful to foreign trade enterprises to adapt to the world market competition and improve their international competitiveness. Luo (2011) believes that due to the global nature of e-commerce websites, the aspect of development makes international trade more likely to occur, and therefore also to some extent seize the market share of traditional trade intermediaries. However, the state of trade intermediate cannot be taken by e-commerce. Trade intermediaries can access information about their customers and sellers and develop business at a high rate through the network. Intermediaries can also use the system to track the transportation of goods in real-time and reinforce the management of assets. The advancement of e-commerce cannot replace the status of trade intermediaries; they can co-occur. Trade intermediaries maximize the utilization of network resources, adjust to the new economic enlargement strategy, and continuously increase their capabilities and strive for market share.     2.4 Value of existence  The development of e-commerce has facilitated many people and solved the problem of time conflicts. It can be purchased online anytime and anywhere, with fewer restrictions. It is very convenient for people who are busy with work, and it can also let people take those pieces of time. Combined, it saves a lot of time and process. Enterprises can also use mobile to run international trade, which is known as mobile- e-commerce. Mobile e-commerce, cellphone devices are devices that can be carried around and are easy to use. Mobile e-commerce is to use these mobile devices for business trade, trade on the Internet and can conduct business-related business activities such as purchasing, consulting, purchasing, placing orders, and payment at any time. Mobile devices need to transmit some data, such as wireless networks that are WIFI (Marano, Cuervo-Cazurra, & Kwok, 2013). WAPI devices can support mobile e-commerce operations, and these can be used easily without too many restrictions. Timely use of the mobile phone to hold a conference call and use a mobile phone solution. Experience mobile meetings with the help of 4G and WIFI networks, and use your phone to manage sessions at any time to maximize productivity.     3.0 Research methodology Since the aim of the data was to obtain data from a comprehensive industrial and geographical coverage, I choose to adopt the research survey method. Applications of e-commerce in operations is an upcoming area of research, and the most appropriate research method for such a study would be analytical survey research. The questionnaire was designed to facilitate an accessible collection of data. The survey questionnaire had three sections. The first section consisted of questions on demographic statistics regarding companies, and the next article was on how internet technology benefits the company. The last part was to help us understand the kind of advice the company receives on technology. And the experiences it has on the use of eCommerce. The skills consisted of barriers and the benefits of e-commerce. 3.1 SAMPLING When the survey to study the use of electronic Commerce by Small and Medium enterprises commenced all companies that had employees who exceeded 250 were excluded. Companies that had less than nine people were excluded as they were considered to have not well adopted the e-commerce application. The sample of small companies consisted of 9-20 employees, while samples of medium companies consisted of 21-250 employees. An example of 1100 companies across china was taken randomly by use of the white pages website, and the questionnaire is sent via email to the IT managers in each company. The questi...