Entrepreneur

In 4 Months, RM896mil Sales Was Generated Under MDEC’s E-Commerce Campaign

We have over 900,000 SMEs in Malaysia today, and almost 99% of them contribute to 38.3% of the country’s GDP and 66% of the country’s employment.

When the COVID-19 pandemic hit us in early 2020 and the government implemented the MCO, many SMEs were badly affected.

An online survey conducted by Recommend.my indicated that 60.3% of SMEs reported financial difficulties even during the CMCO enacted in June 2020.

Almost half of SMEs remained closed during the CMCO period as they struggled to pay employee salaries and premise rentals.

48.3% experienced customer delays or order cancellations, which reduced their potential business revenue.

All of a sudden, there was a greater urgency amongst SMEs to digitalise their businesses.

Aiding The Acceleration Of Digital Transformation

The idea of digitalisation is not new among SMEs. However, many businesses were forced to accelerate their digital transformation in order to stay afloat during the pandemic, and it wasn’t easy for everyone.

Malaysia Digital Economy Corporation (MDEC) quickly stepped in to lend a helping hand.

It launched the PENJANA Micro and SMEs (MSMEs) E-Commerce Campaign and PENJANA Shop Malaysia Online initiatives under the government’s PENJANA umbrella.

Surina Shukri, CEO of MDEC told Vulcan Post, “Since the commencement of the initiatives, over 45,000 new MSMEs have onboarded onto the e-commerce bandwagon with a total of over 115,000 MSMEs benefiting from the PENJANA MSMEs E-commerce Campaign.”

Encouraged to spend on local online sellers, 7.8 million consumers nationwide benefitted from the campaign’s discounts and vouchers on various participating e-commerce platforms.

In total, more than RM896 million in sales was also generated by local merchants through these platforms.

Solving Businesses’ Biggest Problems

Some of the platforms involved were Fave and Grab, for example.

MDEC shared some testimonials from local businesses who benefitted from the campaign, with one of them being Lexis Hotel Group.

The hospitality industry took massive blows when both international and local travel were heavily restricted in March 2020.

Now that interstate travel is allowed, hotels and hospitality related businesses are dependent on local consumers, but Surina noted that many Malaysians are still hesitant about travelling due to the recent outbreak across the nation.

This posed a problem, so Lexis Hotel Group’s solution was to engage Fave to provide special promotions and offers for staycations to local tourists. It worked.

“With the PENJANA initiative provided to stimulate local consumer demand, Lexis Hotels & Resorts saw an increase in bookings for our hotel vouchers via the Fave Malaysia platform, as guests were incentivised via cashback or direct discounts, encouraging them to snap up the best travel deals during a time when domestic travel is the only option for Malaysians,” said Samantha Lee, Executive Assistant – President’s Office, Lexis Hotel Group.

Their hotels in Port Dickson and Penang are seeing more traction from locals, and they’ve managed to keep operations going and their local staff employed.

On the F&B front, local businesses like Vanilla Crepe managed to mitigate losses across its 23 outlets across Malaysia through the PENJANA MSME E-Commerce Campaign.

Grab was also a crucial player that helped restaurants like Tiga Budak Gemok and I Am Grepek Bensu stay up and running through its delivery network and contactless solutions.

The PENJANA initiatives allowed them to provide incentives like discounts, vouchers and free deliveries to increase sales and gain new customers, for example.

With 20 participating e-commerce partners collectively matching the government’s RM70 million allocation under PENJANA MSMEs E-commerce Campaign, the e-commerce platforms have been instrumental in providing not only onboarding training but also seller subsidies and sales support for entrepreneurs and MSMEs to alleviate additional costs such as shipping and marketing.

Surina Shukri, CEO of MDEC

There’s Still More To Be Done

The examples above serve as strong indications for how the adoption of e-commerce will aid Malaysia’s growing digital economy.

According to a recent 2020 Asia-Pacific Small and Medium Business Digital Maturity Study that was jointly commissioned by technology company Cisco and market intelligence company International Data Corporation, digitally mature SMEs could potentially add between RM79 billion and RM99 billion to Malaysia’s GDP by 2024.

The same study also noted that 64% of Malaysian SMEs are planning to digitally transform as they bring new products and services to the market, marking a large jump from 33% last year.

However, the lack of digitally skilled talents, budget, and a proper digital transformation roadmap are among some of the challenges still faced by many SMEs.

“For Malaysian SMEs that have not yet jumped onto the bandwagon of e-commerce, now is the golden opportunity to increase the reach of their existing distribution channels, while also leveraging on the upward trend of e-commerce demand,” Surina advised.

Under its Go-eCommerce initiative, MDEC will continue aiding e-commerce adoption and the digitalisation of companies through programmes for SMEs.

Go-eCommerce is an online entrepreneurial platform with tools like the eBusiness Readiness Tool that evaluates the status of your e-business and provides customised solutions, and tailored programmes like eUsahawan, eCommerce, and Export via eCommerce.

  • You can learn more about MDEC here, and Go-eCommerce here.
  • You can read what we’ve written on MDEC here.

Featured Image Credit: Surina Shukri, CEO of MDEC

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