More support for e-commerce needed

Right policy can incentivise more SMES to get on Internet platforms

PETALING JAYA: More favourable policies that support the growth of e-commerce are needed to encourage small and medium enterprises (SMES) tap the Internet to increase their exports.

While the current pandemic has provided a catalyst for companies to move online, there are still some bottlenecks and obstacles that make it a challenge for e-commerce to advance and give small businesses the market reach they need. Among these are lagging customs clearance and logistics infrastructure.

“Policies which are supportive of e-commerce trade, for example, (and) faster and more efficient customs clearance will help facilitate cross-border trade.

“Additionally, planning and investments in a robust logistics network, including distribution centres and hubs nationwide, and warehousing with flexible automation are key.

“Better infrastructure and greater scale will help bring down the overall cost of logistics to support the growth of e-commerce trade in the country,” said PWC Malaysia partner and deals strategy leader Yennie Tan.

Tan noted that the right policy can also incentivise more SMES to get on platforms to explore different markets and customers.

“If we can encourage more SMES to export, that will help grow the overall e-commerce volume in the market and provide logistics players with the scale needed to further bring cost down,” she said.

Notably, modern logistics infrastructure require some heavy investments and logistics players may hesitate to undertake such an investment, particularly when margins are thin and the e-commerce sector in Malaysia is still small.

This is where the government can provide guidance to the industry through the right policy to stimulate players to invest in their capacity and capabilities.

“I think for many industries that have been around for a while, for them to move up the game, there needs to be a catalyst. One way the government can provide this is through the right policy to incentivise players.

“So if the government can demonstrate that this is what they are willing to do, whether to invest in, say, digital or how to improve the logistics segment and modernise infrastructure, and clearly show these actions, I think it would encourage industry players to seize on opportunities and make their own relevant investments to grow,” said Tan.

This incentive may also include encouraging greater use of technology for automation to improve efficiency in e-commerce and increase the usage of data to help SMES better understand and predict future trends so that they can offer relevant products and services not just locally, but also to the global market.

“Policies which are supportive of e-commerce trade, for example, (and) faster and more efficient customs clearance will help facilitate cross-border trade.” Yennie Tan