In recent years, the emergence of rural commerce platforms has been transforming the economic landscape of rural areas, offering new avenues for business growth and fostering sustainable development.
These digital platforms have opened doors for local products and brands, connecting them with broader markets, overcoming geographical barriers, and providing essential support services. The focus of our exploration is the vital role of rural commerce platforms in building future sustainable businesses, with a particular emphasis on empowering communities in rural areas.
The rise of rural commerce platforms
The growing popularity and significance of rural commerce platforms cannot be ignored. These platforms have brought numerous benefits to rural areas, including expanded market reach, improved logistics, and financial inclusion. By leveraging technology and innovative solutions, rural commerce platforms have become catalysts for rural economic growth and the promotion of entrepreneurship.
As part of its efforts to transform Indonesia into a developed country, the Indonesian government is striving to ensure the addition of one million new entrepreneurs by 2024. These efforts, aimed at achieving an entrepreneurship ratio of 3.95 per cent by 2024, have been set in motion through collaboration between the government and various other entities. However, there are several crucial aspects that will require attention and hard work in order to realise Indonesia’s development goals.
Firstly, the nation needs a digitally connected ecosystem that enables local brands to access new and larger markets easily. Additionally, it is important to establish links between mom-and-pop shops (warung) and industry supply chains, enabling them to contribute as suppliers of finished goods. This will prevent rural entrepreneurs from being marginalised and ensure their active participation within the industrial supply chains and the overall process of industrialisation.
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Rural areas across Indonesia have been realising their respective development plans, especially since 2015, when the rural funds started to be disbursed. As of 2021, the government has transferred Rp 400.1 trillion (US$27,200,495.22) worth of rural funds. Law No. 6, 2014 on rural areas, starting with article 6, encompasses rural development, rural area management, the development of rural-owned companies, and rural cooperation, development, and empowerment.
In relation to this, President Joko Widodo mandated that rural development should benefit all residents, particularly those categorised as poor and extremely poor. This should encompass all rural residents, as nothing is more important than the SDGs adage: No one is left behind.
The Sustainable Development Goals (SDGs) serve as a guiding framework for nations to progress and eradicate poverty. In Indonesia, the process of localising the SDGs began in 2017 when President Joko Widodo issued a Presidential Regulation encompassing all 17 Sustainable Development Goals.
It is crucial to localise the SDGs at the rural level. SDGs Desa (SDGs Village) takes this effort a step further by encompassing all individuals. SDGs Desa serves as the primary reference for medium-term development in villages throughout Indonesia. The indicators from the original SDGs are adapted to suit the village level.
Empowering women entrepreneurs in rural areas
Women entrepreneurs in rural communities face unique challenges, including limited access to resources and networks. Empowering women is crucial for fostering inclusive and sustainable economic development.
Rural commerce platforms play a crucial role in providing opportunities for women to start and grow their businesses. These platforms offer a level playing field, providing them with the infrastructure to facilitate the distribution of high-quality and affordable daily necessities.
In Indonesia, small and medium enterprises (SMEs) contribute to 67 per cent of job creation, with women playing a significant role in both creative work and entrepreneurship. Among all SMEs in the country, a substantial 62 per cent are owned by women at the micro-level.
Women entrepreneurs make an essential contribution to the development of the world economy, particularly in low and middle-income countries. In Indonesia, a middle-income country, the growth of women entrepreneurs is rising from time to time and has tremendous potential to empower women and transform society.
The Global Entrepreneurship Monitor study estimated around 22 million women entrepreneurs or 26 percent out of the adult female population in Indonesia. A similar study has pointed out the importance of women’s entrepreneurship in Indonesia, where women entrepreneurs are operating approximately one-third of firms in the formal sector.
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Access to markets and customers
Rural commerce platforms bridge the gap between local products and larger markets. They enable them to showcase their products and services to a broader customer base that may have been previously inaccessible. By utilising the reach and visibility offered by these platforms, numerous success stories demonstrate the positive impact of rural commerce platforms on the market access of communities.
Overcoming geographical barriers
Geographical barriers can hinder the growth of rural businesses, limiting their market reach. Rural commerce platforms play a pivotal role in overcoming these barriers by leveraging technology and establishing logistics partnerships. This expanded market access opens up new opportunities and potential for business growth, creating an inclusive digital economy by promoting the adoption of sustainable retailing.
Social and environmental impact
Rural commerce platforms contribute to sustainable development goals in rural areas. It is empowering local products to grow together and improve the local economy in rural areas. By providing a wide range of daily products with a seamless user experience in its platform, rural entrepreneurs can create positive social and environmental impacts within their communities.
Rural commerce platforms have emerged as transformative tools, unlocking the potential of rural economies and empowering local entrepreneurs in the process. By facilitating access to markets, providing financial inclusion, offering skill development opportunities, and breaking down geographical barriers, these platforms lay the foundation for future sustainable businesses.
Efforts to foster the growth of rural commerce platforms, along with targeted support for rural entrepreneurs, will pave the way for inclusive and resilient rural economies, driving positive change and sustainable development for generations to come.
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