ABSTRACT (ENGLISH)

The Development of B2C E-Commerce in Ethiopia: Issues and Challenges

Electronic commerce in Ethiopia is an industry that is still in its early stage of

development. This thesis will focus on evaluating the development of B2C (Business-to-

Consumer) e-commerce in Ethiopia. It will look at the current status of B2C e-commerce

within the country so that the challenges and obstacles towards the growth of B2C

electronic commerce can be identified. Thus, the purpose of this study is to evaluate the

status of B2C e-commerce — the limitations, problems and hindrances faced in

implementing B2C e-commerce in Ethiopia.

More specifically, it will also evaluate the market (ie. the perception of the

community towards B2C e-commerce) in an attempt to evaluate its attractiveness from a

consumer perspective. The thesis will also look at the challenges that existing B2C e-

commerce businesses face in adopting electronic commerce and identify factors that are

a hindrance to its development. Investigating the development of B2C e-commerce from

the business as well as from the consumers point of view, allows for the research to

more effectively analyze the national readiness of Ethiopia to embrace B2C e-commerce

which can be useful for entrepreneurs considering entering the market as it can help

them assess the market conditions. Thus, the study aims to make suggestions that can

help entrepreneurs who are interested in entering the industry in their planning strategy

as well as makes recommendations on what needs to be done to facilitate the growth of

B2C e-commerce.

Both primary and secondary data were used to clarify where B2C e-commerce

development in the country currently stands, with the focus being the capital city,Addis

Ababa. A questionnaire method was used to obtain primary data from the market and

from existing e-commerce businesses in Ethiopia. To complement this data,secondary

data has been used to evaluate the status of various factors affecting e-commerce

development.

From the findings we can conclude that there are various factors relating to the

development of B2C e-commerce that need much attention in Ethiopia. The research has

identified 8 main limitations or hindrances to the development of B2C e-commerce in

Ethiopia. Mainly these findings are: poor telecommunication infrastructure; poor bank

infrastructures; consumer perception or mindset towards e-commerce, e-banking, and

telecommunication services; security and trust issues; lack of government regulations

and policies pertaining to e-commerce; unpreparedness of consumers in terms of their

ACKNOWLEDGEMENT

First and foremost,I would like to thank God for tiie strength, guidance, and

opportunity to conduct and complete this study. I would also like to express my heartfelt

gratitude to all those tiiat contributed to the writing of this thesis. It gives me great

pleasure to acknowledge the support and help of my supervisor,Wang Juan. I am

grateful for her efforts to support me in writing this thesis. I would also like to extend

my gratitude to other scholars whose research has served as a base for this research

paper. Additionally, I would like to thank EthioSouk and Mekina who have so

willingly contributed to the research. I wish to also thank my fellow classmates and

friends for their support and encouragement.

I owe my deepest gratitude to my family whose support and assistance made

conducting this research a possibility. This thesis was really a collaborative effort and I

am truly grateful for such a supportive family-

May God bless you all!

MASTER'S THESIS

awareness of B2C e-commerce; and a lack of online payment systems. From this study,

we can fairly conclude that, as things currently stand, Ethiopia is unprepared to embrace

and fully implement B2C e-commerce. However, since the intensity of competition in

the industry is low and it is still an untouched territory, with some focus given to

addressing these challenges and hindrances, B2C e-commerce in Ethiopia can become

more attractive.

Key W ords : E-commerce, e-banking, e-payment,developing country, internet

penetration