Increasing number of local businesses promote sales through e-commerce

This digital transformation is of particular importance amid the global spread of the novel coronavirus (COVID-19) pandemic, with the use of digital technology seen in all activities, especially business operations.

Doan Thuy, a representative of handicraft enterprise Glovimex Co., Ltd, said Glovimex has run various export activities through e-commerce for roughly three years. When transforming from an offline to an online model, the company studied online marketing channels, including B2B e-commerce floors, social networks, and business websites as a means of promoting their products. Gradually, the company's products gained greater traction on the e-commerce floor, becoming the fulcrum for Glovimex to maintain and boost its growth momentum, even when it has been negatively affected by the pandemic.

"When the firm transformed to an e-commerce business, its revenue from sales doubled compared to the traditional method. In addition, it was able to save travel costs and staff while reaching more customers and more orders, and increasing sales,” Thuy shared.

Nguyen Thien Phuc, operations and sales director of Innovative Hub Vietnam, said that in order to sell effectively through e-commerce floors, it is necessary to take advantage of intelligent digitalisation in terms of marketing strategy as a means of having a greater effect. Simultaneously, businesses must pay greater attention to developing their brand identity, a fact that is more true in contemporary society as buyers tend to visit more online channels, search engines, and supplier websites.

E-commerce transactions now not only aim to achieve domestic purchases, but also to facilitate greater export and import activities through e-commerce floors. Despite this, although e-commerce has many advantages to help local firms develop further, as well as to reduce costs, there remains many potential risks in international payment transactions. This can be seen through the risk of fraud, hackers, and the impact of economic sanctions.

Lawyer Le Trong Them, director of law firm LTT & Lawyers, stated that doing business always comes with risk, especially in e-commerce as sellers and buyers never meet. Indeed, differences in culture, process, foreign currency payments, especially quality standards of goods between countries, places of export and import, and international legal regulations outside of Vietnamese territory, pose risks for domestic firms when conducting such transactions.

Furthermore, there are differences in laws, mechanisms, and policies of intermediary units which can cause disputes when local enterprises simply join but do not fully understand the rules, Them noted.

Due to this, Them recommends that businesses strive to build a full, detailed, and specific sales policy, while also attempting to gain a better grasp of the rules of e-commerce floors in an effort to limit underlying risks of economic damage.

The Vietnam E-commerce Association (VECOM) predicts that e-commerce will continue to maintain a growth rate of over 30% this year, with the value of e-commerce set to exceed US$15 billion and hit US$52 billion by 2025. This indicates that the development of e-commerce will continue to be a growing trend in the future.

According to the national e-commerce development master plan for the 2021 to 2025 period which was recently approved by Prime Minister Nguyen Xuan Phuc, e-commerce will be one of the pioneering fields of the digital economy that helps businesses improve their competitiveness and develop export markets. Therefore, e-commerce development will be a necessary and indispensable direction for businesses in the current context.