UAE-Based SMBs Generate 46% of Sales on Digital Platforms, Lowest in 6-Country Study

Digital platforms play a key role in the increasingly connected global economy, enabling businesses across all sectors to reach more potential customers both at home and abroad.

For small- and medium-sized businesses (SMBs) which generate a greater portion of their sales on digital platforms than their larger competitors, these platforms are even more critical to their business growth and development.

Read the report: 2022 Global Digital Shopping Index – SMB Edition

A recent cross-country study of close to 800 merchants from across Australia, Brazil, Mexico, the United Arab Emirates (UAE), the United Kingdom and the United States, revealed that SMBs  generated an average of 57% of their total sales on digital marketplaces in 2021, compared to the 37% generated on digital platforms by larger businesses in these countries.

The SMB-focused PYMNTS study, published in collaboration with Cybersource, also outlined other benefits SMBs can gain from selling through digital platforms, including access to a wide assortment of digital shopping features and the infrastructural flexibility it gives them to easily and quickly add or remove new features to match customers’ shifting demands.

With Heavy Reliance Comes Risks

Despite its advantages, merchants’ reliance on digital platforms can come at a heavy business cost, particularly when there is a switch in platforms, when old partnerships are terminated and new ones are formed, or in a scenario where a platform partner changes their feature offerings.

All these can have a significant impact on their bottom lines, a clear indication that choosing the appropriate partner platform is a critical decision for SMBs, regardless of their geographic location.

But according to the report, there were differences in the level of reliance on platforms depending on where businesses were located geographically.

For example, SMBs in the U.S. and the U.K. generate far more sales on digital platforms than those in any other country, with 71% of the average U.S. SMB sales and 65% of the average U.K. SMB turnover generated on these platforms.

SMBs in the UAE, however, emerged as the least of all to rely on digital platforms, even though digital platforms remain essential to their businesses — UAE SMBs generate on average 46% of their sales on digital platforms.

Overall, “platforms represent a quick and cost-effective way for SMBs to boost conversion and enhance their customers’ shopping experiences, such as by enabling support for buy now, pay later (BNPL) options or voice-enabled purchases,” the report noted.

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