How DHL’s ‘GoTrade’ opens global doors for SMEs

DHL Group Head of GoTrade Sarah Meinert

If we are successful in bringing SMEs to trade and export their products to a broad market, we then also improve lives. So, we know that SMEs are the backbone of all economies; 80% of the economy of businesses worldwide are SMEs. They also create a lot of employment and play a role in economic growth. This is why we are definitely improving lives with GoTrade, and also with our other “Go” programs, including GoTeach, GoHelp, and GoGreen

By Divya Thotawatte 

As global supply chains evolve and developing economies strive to recover and grow, it becomes more crucial every day to empower small and medium enterprises (SMEs) to access international markets. The DHL Group’s GoTrade program aims to achieve just this, facilitating cross-border trade for SMEs through training, logistics support, and strategic partnerships. 

During her visit to Sri Lanka recently, DHL Group’s GoTrade Program Head Sarah Meinert spoke with Daily FT about the initiative’s work on the ground, including ongoing collaborations with local institutions to strengthen the growth of SMEs. With a background in development research and a passion for gender equality, Meinert shared insights on how GoTrade went beyond business to create real opportunities for small and emerging entrepreneurs. 

Q: What is GoTrade and why it was created?

GoTrade is a sustainability program by DHL Group, which was launched in 2020. With GoTrade, we are leveraging what we are good at as logistics providers: our global reach and the expertise of our 600,000+ employees. We are the ones who know everything about e-commerce, international trade, and what needs to be done to get your package from A to B. With this in mind, it was basically a board decision to come up with a program to support SMEs to enable them to then go cross-border. We have rolled it out successfully in all regions of the world right now, and also trained quite a few SMEs up to now.

Q: How does GoTrade fit into DHL’s larger purpose of connecting people and improving lives?

It’s basically the core of it. We are connecting people by doing trades and, hopefully, by this, also improving lives. In the end, if we are successful in bringing SMEs to trade and export their products to a broad market, we then also improve lives. So, we know that SMEs are the backbone of all economies; 80% of the economy of businesses worldwide are SMEs. They also create a lot of employment and play a role in economic growth. This is why we are definitely improving lives with GoTrade, and also with our other “Go” programs, including GoTeach, GoHelp, and GoGreen.

What kind of impact has GoTrade had globally so far, and any success stories you could share?

Since our launch in 2020, we have trained over 12,000 entrepreneurs globally. We are in all regions of the world, and we’ve seen quite some successes. Once you unlock this kind of potential and knowledge on how to trade cross-border, and once the first shipment is done, usually, it also gets easier. For example, there was a lady from Uganda who had a luxury sleepwear brand. She had a shop, but she was struggling to have a wider reach since she started domestically. It’s a huge hurdle for entrepreneurs to find customers even in neighbouring countries. This is where we came in with one of our programs and supported her with the knowledge of what it takes to go abroad. Now she’s exporting globally. This is what we’ve seen in other instances and other regions as well. Once you have the knowledge on how to do it, where to go with your products, and also the support from our logistics side, it can be a game-changer.

Q: What are the biggest challenges small businesses face when trying to trade internationally, and how does GoTrade help?

Trading internationally encompasses numerous hurdles, ranging from access to finance to technological challenges and a lack of knowledge in e-commerce. When it comes to e-commerce, it involves understanding online market dynamics, implementing effective digital strategies, and overcoming barriers related to logistics, payment systems, and regulatory compliance. Addressing these knowledge gaps is essential for successfully navigating the e-commerce landscape.

In the end, it’s really about empowering entrepreneurs with this knowledge and partnering up with other organisations who can then complement what we are doing to really enable entrepreneurs to go abroad. This is what we have done in all regions successfully.

Q: Why did you choose Sri Lanka as one of the countries for GoTrade?

 Sri Lanka, like the other countries we operate in, has a huge SME base. I know that there is a Governmental proposal right now out there to systematically support SMEs as well. This is why we can nicely complement what we have in our offerings for the Government to reach their objective of supporting entrepreneurs in Sri Lanka, making the products known abroad, and also to ship them abroad. 

We want to build a holistic ecosystem that serves SMEs to bring them through the value chain, support them in the different maturity levels, and also make it sustainable. 

Q: What are the key projects or partnerships you’re working on here?

 In Sri Lanka, we already have an MOU with the Industrial Development Board (IDB). We also have a strategic partnership agreement with the Ceylon Chamber of Commerce. Separately we are also actively engaging in discussions with the Export Development Board and the Bank of Ceylon.

Q: How are you working together to help the local SMEs?

 We partner up. We do this, not only in Sri Lanka, but everywhere. There are several key things to that. First of all, we usually reach more SMEs. The other thing is we can leverage each other’s strengths. Usually, the partners bring their knowledge, training, or whatever offerings they have for SMEs to the table. We are seeing how we are complementing what the partners are already doing. We share the same objective with our partners. This is why partnership is so important for us and also crucial to implement our projects together. Their knowledge and expertise are vital as well to make it really successful for everyone involved.

Q: You also published a White Paper this year with USAID and the eTrade Alliance. What are the main takeaways, especially for Sri Lankan businesses?

 We launched the White Paper last year towards Q3. But we did the survey back in 2023 during the first half of 2023 as the effects of COVID-19 were tapering off in Sri Lanka. Additionally, the primary survey also happened to take place during Sri Lanka’s current macroeconomic crisis, which has impacted many MSMEs to date. There are altogether 17 findings. 

One key finding is that only 28% of medium, 8% of small, and 4% of micro enterprises are currently actively engaged with exports. Cross-border exports also remain desired, but harder to achieve for much of the surveyed MSMEs. Other than that, only 12% micro, 15% small and 44% medium enterprises are currently using e-commerce as a platform to sell their products. This shows that a majority of MSMEs are yet to consider the potential that e-commerce could add to their product visibility and brand identity, on top of being an additional sales channel. The three biggest challenges we identified are a lack of capital, a shortage of trained staff, and a lack of sales, marketing, and research skills. 

Only 55% of women-owned MSMEs are selling directly to end customers. But what’s surprising is that the percentage is  higher in comparison to male participants. Male-owned SMEs are only 38% while female-owned SMEs are 55%. Also, 91% of micro and 86% of small enterprises still heavily depend on the power of word of mouth. Despite the gradual proliferation of internet access in the country and access to digital forums and platforms, word-of-mouth referrals still remain the most sought-after mode of advertising for a majority of MSMEs. Another key finding is that over 60% of small and micro enterprises still depend on vendors and supplies for product enquiries rather than on their end customers. 

We did this survey among 633 SMEs. We know most SMEs are rural-based. So we did the split, 433 in rural areas, and the balance is in urban areas. In our project, we focused on female-led entrepreneurs as well. Hence, the reason that out of the whole 633, we focused on 200 female-owned enterprises. 

Q: How are you helping Sri Lankan SMEs build the skills they need to trade globally?

 It’s very crucial to go through a dedicated discussion and select which SMEs to target and who can benefit most from our training. The other crucial thing we see is that we need to pick and choose what we offer and tie it to their needs. It doesn’t make sense to offer a lot if it’s not relevant to the entrepreneurs. Usually, we are doing this together with a partner and deciding on how we will conduct the training. So, we can conduct the training in the classroom, or we can conduct it online. 

We also trained DHL colleagues on the content. We have an internal training and development department that is taking care of that. Our colleagues who go out and train the SMEs really need to go through this very rigid training schedule internally first. This is because we need to make sure that the quality of the training is similar globally. In total, we have 250 trained DHL colleagues around the globe. Here in Sri Lanka, we already have eight. Then we evaluate if we need to translate the content into the local language as well, which we have done here in Sri Lanka.

Q: Will there be targeted support for women entrepreneurs? 

 We have this very much in mind, and our ambition is to have at least a 50/50 percentage of male and female entrepreneurs. Honestly, we haven’t reached this yet because we are facing some difficulties reaching out to female entrepreneurs, and also acknowledging and catering to some of the specific challenges they have. We are trying hard together with our partners to tackle that and see how we can get an equal share of female entrepreneurs into the program. 

Trading internationally encompasses numerous hurdles, ranging from access to finance to technological challenges and a lack of knowledge in e-commerce. When it comes to e-commerce, it involves understanding online market dynamics, implementing effective digital strategies, and overcoming barriers related to logistics, payment systems, and regulatory compliance. Addressing these knowledge gaps is essential for successfully navigating the e-commerce landscape.In the end, it’s really about empowering entrepreneurs with this knowledge and partnering up with other organisations who can then complement what we are doing to really enable entrepreneurs to go abroad. This is what we have done in all regions successfully.

Q: What’s your long-term vision for GoTrade in Sri Lanka, and where do you see it going in the next few years?

 We envision setting up a functioning ecosystem in the country with like-minded partners. It is usually on the Governmental side because there are already development programs out there for SMEs, and also visions on how to drive SME development for the next few years. But we’re also looking to have private sector partners on board who can address further challenges of the SMEs’ logistics. 

Financing is a big elephant in the room as well, and this is where we need to have other private sector partners like banks come to the table, and see what they can offer in terms of financial knowledge, and also in terms of hands-on loans. Same with digitalization. When we are talking about AI, it should be done by a partner who’s an expert in that. 

By combining these strengths and offerings, we want to build a holistic ecosystem that serves SMEs to bring them through the value chain, support them in the different maturity levels, and also make it sustainable. 

Q: As the head of GoTrade, what’s been the most rewarding part of leading this program?

Seeing entrepreneurs succeed and grow is the most rewarding thing. This is what we are doing and hoping to succeed.

    FT Key Take    

Only 28% of medium, 8% of small, and 4% of micro enterprises are currently actively engaged with exports. Cross-border exports also remain desired, but harder to achieve for much of the surveyed MSMEs. Other than that, only 12% micro, 15% small and 44% medium enterprises are currently using e-commerce as a platform to sell their products. This shows that a majority of MSMEs are yet to consider the potential that e-commerce could add to their product visibility and brand identity, on top of being an additional sales channel. The three biggest challenges we identified are a lack of capital, a shortage of trained staff, and a lack of sales, marketing, and research skills. Only 55% of women-owned MSMEs are selling directly to end customers. But what’s surprising is that the percentage is  higher in comparison to male participants. Male-owned SMEs are only 38% while female-owned SMEs are 55%. Also, 91% of micro and 86% of small enterprises still heavily depend on the power of word of mouth.