PETALING JAYA: E-commerce can bring many benefits in expanding reach beyond the local market for companies to remain competitive, without incurring heavy costs.
At the same time, the Cloud technology behind e-commerce enables them to scale up easily, depending on demand.
While SMEs create 66% of the country’s total employment, their contribution to export was at 17.3% in 2017, according to the Department of Statistics Malaysia.
Speaking at the half-day Tea Talk #1, CIMB Bank Bhd SME Banking Malaysia head KJ Balan said e-commerce is the way forward for small and medium enterprises (SMEs) due to changing behaviour in the next generation of consumers.
Part of the SME Thought Leadership series, Tea Talk #1 was held at Menara Star here with the theme Enhancing SME Competitiveness in E-commerce.
It covered the benefits of e-commerce, key considerations when undertaking e-commerce initiatives, as well as the importance of Cloud technology to e-commerce.
“E-commerce is a way for you to expand your market regionally. There’s room for growth when it comes to export and we can change these statistics if SMEs grow aggressively into e-commerce.
“If our SMEs are not ready to go beyond Malaysian borders, chances are that we’ll be swamped by the global market,” he said during his presentation titled “Enhancing Growth via E-commerce”.
E-commerce platforms handle the issues of legal and regulatory requirements in doing cross-border business, easing access to regional market expansion for SMEs.
Beyond that, he said issues such as cross-border transactions, payments and delivery are more easily resolved for SMEs using e-commerce platforms, instead of setting up physical outlets to reach the market.
Apart from that, Balan stressed on the importance of hiring the right talent as a company expands into e-commerce and data analytics.
He said CIMB Bank works with partners for accounting and human resource solutions, as it believes these are essential aspects for SMEs.
“You can’t avoid competition or the evolving market. You just need to move ahead and along with it,” he said.
Balan’s presentation was followed by Alibaba Cloud Malaysia general manager Kenny Tan’s talk titled “Manage the Efficiency of Your E-commerce Growth”.
Tan noted that e-commerce is more than just putting photos of products online.
Touching on the topic of transformation, he highlighted that Cloud technology has grown in tandem with e-commerce to include innovations such as personalised recommendations, image search capabilities, live streaming product broadcasts, artificial intelligence (AI) customer support and biometric technology among others.
E-commerce platforms leverage the Cloud technology to scale up during sudden traffic spikes in demand, ensure regulatory compliance as well as data security and privacy to make it easier and more cost-effective for companies to do business, he said.
He further said that although big data and AI are big buzzwords today, businesses must link the technologies back to the issues they are trying to resolve.
While an e-commerce presence is desirable, ensuring its sustainability and flexibility through using Cloud technology is key as a company scales up.
Tan advised SMEs to first focus on increasing traffic and volume to their online stores by leveraging established e-commerce platforms, with an eye on the technology’s stability and availability.
“As a Cloud provider, we look at the scaleability and security standpoints so that SMEs can leave the platform to the experts and focus on sales and strategy.
“In any e-commerce, there are attacks that try to bring the platform down. We have successfully blocked 1.6 billion attacks on Taobao and Tmall’s Double 11 Shopping Festival 2018, so it shows that security has become an important component of today’s e-commerce,” he said.
Created as a platform for dialogue and learning within the business fraternity, the SME Thought Leadership series is aimed at dissecting emerging business issues and identifying opportunities that can be leveraged to grow businesses.
The SME Thought Leadership 2019 series is organised by Star Media Group and presented by CIMB Bank Bhd.