Tuesday, March 5, 2024

MSMEs need e-commerce infra to exploit rising online biz in PH, says DTI exec

The country’s micro, small and medium-sized enterprises (MSMEs) need a more secure e-commerce infrastructure if they are to take advantage of the current boom in online selling.

Screenshot shows (from left, top) Locad CEO and co-founder Constantin Robertz, Manila Athletica CEO Aencille Santos, Etaily CEO and co-founder Alexander Friedhoff, DTI-PTTC executive director Nelly Dillera, Digital Pilipinas convenor and GeiserMaclang co-founder Amor Maclang, and Nuprene brand manager James Fernando

This means many small companies are still without a proper e-commerce infrastructure to be able to expand their businesses and participate in e-commerce.

Nelly Dillera, executive director of the DTI’s Philippine Trade Training Center, said there are currently more than 800,000 thousand MSMEs.

“The number of MSMEs is close to one million. These small businesses need more secure e-commerce infrastructure, which will be key to support them,” the official, in an online webinar organized by logistic firm Locad, said.

Dillera said the government is now looking for institutions to allow this, and that the “holy grail” for MSMEs is to go beyond their usual business practices. “We need to empower these MSMEs,” she said.

Dillera said MSMEs also need to be informed of the e-commerce trends and challenges particularly in the country, if they are to be able to capitalize on e-commerce.

Various reports indicate that the whole e-commerce market in the Philippines is projected to reach $15 billion by 2025.

Speaking of e-commerce trends, logistics firm Locad recently disclosed key findings of its studies on e-commerce trends in the Philippines in the said webinar.

Constantin Robertz, co-founder and CEO of Locad, said one of the challenges for MSMEs is to “widen” their reach. “The goal is to democratize e-commerce,” Robertz said.

Robertz said regional equalization is another trend that local MSMEs need to look out for. This trend means buyers now have the same products, the same prices, but the only difference is shipping.

Thus, MSMEs face competition even from companies not based in the country. Further, Robertz said MSMEs need to be aware of nontraditional e-commerce ways of engaging in e-commerce. One of these nontraditional ways is the rise of “social” e-commerce.

Robertz said one primary example of social e-commerce is video. This trend is often seen on Facebook, where sellers “demo” their products.

“The key difference is that there is no direct transaction when an online company conducts a video or demo. However, the video does drive a lot of traffic, and thus, drive sales,” he said.

Robertz said in the Southeast Asian region, 50 percent of customers say that video affected their purchasing decision.

Although there are no exact figures in the Philippines, video selling, where sellers demo their merchandise through Facebook, has become very popular. Payment for the merchandise is often done through mobile wallets and the merchandise is often delivered through the numerous fulfillment and delivery services available throughout the country.

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