B2B e-commerce is gaining ground in the Middle East

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Executives in the two largest economies in the Middle East Gulf Cooperation Council region say they already buy a majority of their supplies online, and a large majority expect inter-company e-commerce to grow in importance in the years to come.

In the survey commissioned by B2B marketplace operator Tradeling, 47% of executives in Saudia Arabia and 46% in the United Arab Emirates said their businesses mainly shop online. And 82% of respondents in the survey of 500 executives said that companies assume that they will use B2B e-commerce more in the future.

The COVID-19 pandemic has spurred the adoption of digital commerce, says Marius Ciavola, CEO of Tradeling based in the United Arab Emirates.

What slowed the growth of e-commerce for nearly two decades, especially in the Middle East region, has gone.

Marius Ciavole, CEO

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“What has slowed the growth of e-commerce for almost two decades, particularly in the Middle East region, has gone,” Ciavola said in a press release that accompanied the poll results released on Monday. “At the height of the pandemic, customers had no choice but to shop online and that opened the floodgates of business opportunities.”

71% of the respondents stated that they made at least a quarter of their purchases via B2B online marketplaces, 40% stated that marketplaces account for at least three quarters of the transactions. The results excluded those who answered “don’t know”.

However, payments are often made offline by cash and check, the survey shows. Two-thirds of respondents said they used such physical payment methods – as opposed to electronic means like payment cards or online bank transfers – to pay for purchases, including 42% who said they had used traditional payment forms for at least three-quarters of purchases .

The industries in which companies are least likely to shop online are automotive and construction, while they are most likely to make e-commerce purchases in segments such as electronics and computers, and fashion and beauty.

The survey of 500 executives, evenly split between the United Arab Emirates and Saudi Arabia, was conducted in January by PSB Middle East, a consulting firm that is a subsidiary of Asd’a BCW, a public relations firm based in Dubai, the capital of the USA, carried out for tradeling UAE.

AI will have an impact on B2B e-commerce

Further results of the survey show:

  • 84% of the respondents from the UAE and 73% of the respondents from Saudi Arabia expect that e-commerce will become more important in their countries in the coming years.
  • When asked which technologies will significantly transform companies over the next five years, 62% said artificial intelligence and machine learning were number 1. 56% said AI would significantly transform B2B e-commerce. Other technologies expected to have a big impact are cloud and mobile computing (44%), robotics (44%), virtual currency or money (44%), and robotics (43%).
  • 83% of respondents agreed that B2B e-commerce will help small businesses in the region find new customers, and 85% said B2B e-commerce is the emergence of a more diverse range of small and medium-sized businesses in the region will facilitate.
  • 52% said business conditions are good now, suggesting executives believe a post-pandemic recovery is underway. Business executives targeting consumers were particularly optimistic: 69% of calling conditions were favorable compared to 50% for B2B companies.
  • 78% of UAE executives said business conditions will improve significantly in a year, compared to 68% in Saudi Arabia.

Tradeling is a B2B marketplace that has existed since 2020. He is financially supported by Dubai Airport Freezone, which offers tax benefits as well as import and export services for foreign companies.

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