Accelerating exports through eTrade
TODAY, doing business via e-commerce is no longer just an option for many businesses. It is now the norm. The move towards e-commerce is driven by changes in consumer demand, growing spending power of the middle class, rapid expansion of mobile user base and the need for cost savings.
Malaysia External Trade Development Corp (Matrade) is involved in advancing the government’s agenda on e-commerce and is helping to push e-commerce among exporters.
With the launch of the National eCommerce Strategic Roadmap (NESR), by the Prime Minister in October 2016, Matrade spearheads one of the six strategic thrust areas of the NESR – to promote national brand to boost cross-border e-commerce. This responsibility is aligned to Matrade’s role as the national trade promotion agency under the Ministry of International Trade and Industry (MITI) in promoting Malaysia’s exports.
Matrade started to promote the adoption of e-commerce for exports among Malaysian SMEs in 2014 through the eTrade project, a Digital Malaysia initiative mooted by Malaysian Digital Economy Corp.
The eTrade initiative will continue with additional scope and incentives. eTrade advocates the promotion of Malaysian products and services by listing them in leading international e-marketplaces such as Alibaba. com, TradeIndia.com, DagangHalal. com, Amazon.com, eBay.com, Tmall Global, JD.com, Suning.com, yhd.com, MatahariMall.com, Qoo10.sg, Tarad.com as well as AladdinStreet.com.
By listing in the leading business-to-business (B2B) or business-to-consumers (B2C) leading international e-marketplaces, participating SMEs will be able to tap into international buyers available on these e-marketplaces and participate in online sales events such as Singles Day, Cyber Monday and others.
To create awareness on eTrade and encourage companies to start exporting through e-commerce, 90 outreach activities in the form of seminars, workshops, webinars, trade talks and information booths were conducted in 2016. These activities, held in collaboration with e-marketplaces, e-commerce players and trade associations, have benefited 15,000 participants from 8,000 companies.
Since its inception, 835 SMEs from various sectors such as food and beverages, furniture, lifestyle, building materials, machinery and hardware, and auto parts have been approved for the eTrade financial incentive, which range between RM1,000 and RM7,000 per company.
Out of those approved, 641 SMEs have completed their company’s listing on the e-marketplace of their choice.
Through eTrade, SMEs secured sales in 24 export markets including Australia, Japan, South Korea, China, US, the European Union and Asean. Several challenges were reported from the feedback obtained from eTrade participating companies.
Some include lack of understanding on benefits in adopting e-commerce particularly for exports, limitations of competent personnel to conduct e-commerce activities, fear of cyber security threats, lack of digital marketing skills, limited production capacity, high fulfilment and logistics costs, and lack of knowledge regarding market access and regulations in cross-border e-commerce.
Recognising these challenges and the different levels of export and e-commerce readiness among the Malaysian companies, Matrade, through greater collaboration with other NESR lead agencies, government ministries and agencies, trade associations and e-commerce players, will introduce new initiatives and activities under the eTrade programme for this year.
Among the initiatives are the development of two categories of digital exporters – eTrade champions and MYe-Xporters, each with a different incentive model and e-commerce capacity building programme.
Discussions with strategic partners are ongoing and details of the enhanced eTrade programme will be announced in the first quarter of 2017.
For more information on the NESR, log on to www.miti.gov.my