MSMEs and their Active Role in the Growth of Philippine E-Commerce

e-commerce entrepreneurs summit
e-commerce

By Rod Gabriel, Negosentro.com

I was recently invited by BlogADia to be part of the media group, which will cover the E-Commerce Entrepreneurs Summit in A Venue Hotel, Makati city, last January 7, 2017.

Knowing that it’s a Janette Toral event and me being involved with two e-commerce companies,  I immediately said, yes. I needed to get new information and be updated with the latest innovations in e-commerce.

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Department of Trade and Industry Assistant Secretary, Arturo Boncato gave the opening talk on the department’s milestones on the Philippine E-Commerce Roadmap.

Recalling the events that transpired, the Department of Trade and Industry launched the Philippine E-Commerce Roadmap 2016-2020, as well as the e-commerce.gov.ph website, where over 150 industry stakeholders and officials/representatives from government agencies participated, on February 2, 2016.

The roadmap is the Philippines’ first on e-commerce and the Department of Trade and Industry expects renewed collaborations between the government and the private sector with the intent to accelerate the growth of Philippine e-commerce.

The objective of the roadmap is to contribute 25% to the Philippines’ gross domestic product (GDP) by 2020. The country’s micro, small, and medium enterprises (MSMEs), which make up 99.6% of Philippine enterprises, will largely benefit from this initiative. By participating and engaging in e-commerce programs and projects, Philippine MSMEs  can become globally competitive.

In the summit, Assistant Secretary, Arturo Boncato Jr. of the DTI announced that over 400 Negosyo centers were established by the department in the last quarter of 2016. This will be a welcoming development to business minded individuals, who have experienced challenges in setting up start-ups. Aspiring business-minded individuals will now be encouraged to go entrepreneurial. They will now get assistances from experts in DTI. Not like before, when you are left on your own to learn how to register a business.

DTI’s Negosyo centers are business one stop shops that are intended to help MSMEs build and develop their businesses. The Department of Trade and Industry aims to integrate E-Commerce in the realm of MSMEs to enable these businesses to become participants in online platforms.

It is now well known that the e-commerce infrastructure has shifted from e-commerce to m-commerce (mobile commerce), and with this shift, the local telco players are now in the process of creating their own ecosystems, with the intent to use their members as base of infrastructure.

Department of Trade and Industry Secretary Ramon Lopez has mandated the department to go beyond the 100,000 MSMEs that should do e-commerce by 2020.

In line with this mandate, all agencies involved are working hand in hand to support the roadmap. The government plan is intent to improve internet service in the Philippines. Of course, speed and cost of internet service is an important factor in the success of the roadmap. We all hate slow and expensive internet connections. However, the success of the roadmap will also depend on the help of the private sector.

The Philippines has the fastest growing number of internet users, and has a high presence online. It is expected that mobile broadband subscriptions are expected to exceed the Philippine population by 2021. Well, only a few of my friends doesn’t have data plans with their smartphones.

The e-commerce market is expected to grow steadily in the next 9 years, parallel to the expected improvements of IT infrastructure in the Philippines.

Doing my research on the topic, I found out that on August 8, 2016, a memorandum of understanding for the establishment and launch of the QBO Innovation Hub for startup and innovation entrepreneurs was signed between the Department of Trade and Industry (DTI) through its Export Marketing Bureau (EMB) and IdeaSpace Foundation (IdeaSpace), The Hub aims to link innovators, explorers, investors, academic institutions, start-up mentors, funders and enablers as well as a broad spectrum of partners and stakeholders from both public and private sectors to convene in constructive interaction and is DTI’s support to the startup community, particularly targeting startups with viable business propositions.

According to DTI-EMB Senen M. Perlada, the initiative is DTI’s way of providing relational form of assistance that boosts the climate of collaboration within the startup community, private sector, the academe and the government. The QBO Innovation Hub is intended to serve as an avenue to urge more micro, small and medium entrepreneurs (MSMEs) to collaborate and explore opportunities that disruptive technologies can offer.

The move of the Department of Trade and Industry is to encourage entrepreneurship in the country, through the 400 plus Negosyo Centers, which are equipped with materials and resource supports that will assist entrepreneurs and would-be entrepreneurs.

The Department of Trade and Industry is making its way to forge stronger partnerships in the private sector, and is committed to improve trade policies and reforms in the government. It will continue to establish more Negosyo centers, and provide mentoring programs, and hold e-commerce festivals across the country to achieve its target.

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Data gathered by I Metrics Asia Pacific Corporation, as presented by Dr. Nick Fontanilla, in the E-Commerce Entrepreneurs Summit, proves that E-Commerce is now playing an important role in revenue generation. See image below:

i-metrics-data

In the summit, I got to know the CEO of Alfox Printing Services. Alfox Printing Services is an online print shop that allows their customers to place their print orders online by creating, browsing or uploading their designs through the company website. Located in Kamuning road corner EDSA, Quezon city, the company started out selling computer peripherals in 1998, and then shifted to printing services in 2014.

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Abigail Lim, CEO of Alfox Printing Services, says that in order to survive, entrepreneurs like her should always think of ways to improve the business’ sustainability. With that in mind, Abigail was determined to use E-Commerce.

In October, 2015, in an effort to expand their market reach, the company decided to put up a website that will cater to the needs of the online market.

Upon checking the website, it has an online editor and has several templates that customers can use in designing calling cards, and other forms of print outs. If a customer wishes to upload his own design, they may do so by uploading the design to the website.

Payments are either done through over the counter at BDO (this is convenient, as BDO branches in SM Malls are open on weekends) or through Paypal.

Abigail Lim considers their move to e-commerce as a success. She says that 20 to 30% of their revenues are now coming from their online platform.  With the prevalence of app based courier services, Alfox now has the ability to deliver their finished printouts to their customers, same day within Metro Manila.

With the Philippine E-Commerce Roadmap plans coming to fruition, companies, like Alfox Printing Services are taking the lead in facing the global market. Well, that’s about it. I need to design my new The Rod Trip.com calling cards and send them to Alfox for printing.

By the way, for those interested, there is still time to attend the event in the following dates:

Cebu – January 14, 2017

Baguio – January 21, 2017

Davao – January 29, 2017

For more details, kindly visit http://www.ecomsummit.asia/

Source: dti.gov.ph, alfoxprinting.com

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