V

ivek Prabhakar, a founder of souvenirs company Chumbak in India, never thought that he would manage to sell Bajaj-printed T-shirts and mugs in Japan. Thanks to the Internet, however, he has struck a deal to sell Chumbak products in 100 stores across Japan.

Having set up the company with his wife in 2009, Prabhakar said he started the venture by selling his own house for initial capital. He and his wife later moved out to a small apartment, which he modified to become Chumbak's factory and warehouse.

'We previously advertised our products by compiling a PDF catalog of our products and mailing it to around 10 different people,' Prabhakar said. 'In April 2010, we went online [chumbak.com]. Within six months we began making a profit and ended up with eight to 10 stores selling Chumbak goods across the country,' he added.

'Before long, a very interesting thing happened. We got an email from some people in Japan. They asked us to send them some samples. We couldn't believe it; someone in Japan wanted to distribute our stuff,' he said.

By the end of last year, Prabhakar was selling Chumbak products in 150 stores across India and 100 stores in Japan.

Chumbak is just one example of a small business using the Internet to rewire Asia's economies.

The president of Google Asia Pacific, Karim Temsamani, said that more and more small and medium enterprises (SMEs) were using the Internet for growth, to advertise their products to the world with very low marketing expenses.

'A small business starting up today in Asia has more opportunities to grow and prosper than their counterparts in even the most industrialized Western nation would have had just 10 years ago,' Karim said. 'The web is what's making this happen.'

A small business nowadays could advertise not only to people in their immediate area, but to everyone with an Internet connection ' 2.5 billion people, he said.

However, Karim added that despite the rapid growth of Internet penetration, Indonesia's SMEs were still way behind in terms of online presence compared to other countries in the region, .

'When you look at small businesses in the country, fewer than 10 percent are online. That is a very bad situation, because prospective purchasers cannot find information online while the businesses are missing a lot of opportunities to expand,' Karim said.

'With the Internet, you have the ability to set up a business and reach the world in a unique way,' he
added.

According to a report by Anu Madgavkar, a senior fellow at the McKinsey Global Institute, SMEs in Indonesia contribute around 57 percent to the country's gross domestic product (GDP).

Anu said low awareness among Indonesian SMEs of how to advertise their products online was one of the main constraints to their development. 'Another challenge is access to credit. The banking system is not very friendly to SMEs in Indonesia,' she said. 'They perceive them [bank loans] as high risk.'