Vietnamese goods exported through cross-border e-commerce platforms
Starting from a shop selling handicraft products to tourists, after a period of retail business, realizing that international customers love Vietnamese products, especially traditional products, Indochina Investment and Creative Development Joint Stock Company decided to establish an Import-Export Business Department at the end of 2015. In August 2015, the company successfully registered a Gold Supplier account for handicraft products on the cross-border e-commerce platform Alibaba.com. Just over a month later, the first order was received.
Ms. Hoang Thi Thanh Tam, Director of Indochina Investment and Creative Development Joint Stock Company, shared that from that first order, in 2017, Indochina registered another account on Alibaba.com, focusing on promoting unique art products. In February 2022, Indochina upgraded to the Verified Suppier service package (verified supplier). Since then, Indochina's online store on the Alibaba.com e-commerce platform always has up to 60 products on display shelves instead of 10 - 20 like normal accounts. After Indochina became a verified supplier, interactions increased by more than 50%, the number of inquiries tripled, the number of successful orders increased by more than 30%... compared to before. From a small store at first, after nearly 9 years, Indochina has had more than 3,000 orders from the US, Canada, Denmark, Japan, Korea...
Cross-border e-commerce platforms offer opportunities for exports.
Also one of the small businesses trading organic agricultural products, Organic Viet Food Company (OVF) has decided to put its cashew products on e-commerce platforms to seek export opportunities. Determined to be standard from the beginning, Binh Phuoc cashew products have been built by OVF under the Newbam brand with packaging, design, packaging... meeting export standards.
At the same time, OVF registered its business on the Amazon e-commerce platform, and persistently learned and met the criteria instructed by Amazon. Thanks to that, Newbam cashew products were quickly put on Amazon shelves. In November 2022, Newbam cashews exported the first batch to the US. Up to now, Newbam cashews have been exported quite regularly to the US and Canada.
The success story of Indochina and OVF is not uncommon for Vietnamese products on the journey of cross-border export via e-commerce. Mr. Ta Hoang Linh, Director of the Department of European and American Markets (Ministry of Industry and Trade) said that cross-border e-commerce is increasingly booming, growing rapidly, and becoming one of the top priorities, a core factor of the global economy and an inevitable trend that no country can stand outside.
In the context of Vietnam's increasingly deep integration with the world economy, along with opportunities from new generation free trade agreements, participating in the online import and export system and cross-border e-commerce channels is an effective solution, opening up many opportunities for Vietnamese enterprises to expand their customer base, increase market reach, improve business capacity and the quality value of goods originating from Vietnam, bringing Vietnamese brands to consumers in many markets around the world.
The 2023 E-commerce Report by the Department of E-commerce and Digital Economy shows that retail e-commerce revenue in Vietnam in 2023 is expected to increase by 25% compared to 2022, reaching 20.5 billion USD, putting Vietnam in the top 10 countries with the highest e-commerce growth rate in the world. The global e-commerce market is forecast to grow strongly with an expected revenue of 7.4 trillion USD by 2025.
According to statistics from Amazon Global Selling, the number of products sold by Vietnamese businesses on Amazon has increased by more than 300% in the past 5 years. Thousands of Vietnamese small and medium-sized enterprises are currently exporting through Amazon, with the number of businesses with annual revenue of over 1 million USD skyrocketing nearly 10 times. Through Amazon's platform, Vietnamese goods have the opportunity to reach more than 2 billion people online each year in markets in North America, Europe and many other countries such as Australia, Japan, Singapore, India, etc.
According to Ms. Nguyen Thi Phuong Uyen, Marketing Director of Alibaba.com Vietnam Co., Ltd., the advantage is that Vietnamese goods are increasingly competitive and highly appreciated by the international market not only for price but also for design, model and quality. This is a very important factor for Vietnamese goods to take advantage of the opportunity to reach out to the world.
“Vietnamese goods are also enjoying the benefits of free trade agreements that we have signed with countries such as the UK, Europe, the US and Southeast Asia. Thanks to that, goods have the advantage of low import tax or reaching zero for countries such as the UK and the EU. This is a superior competitive advantage compared to suppliers and businesses in other countries such as China, Thailand, Singapore. These are advantages that Vietnamese businesses should grasp and develop,” said Ms. Nguyen Thi Phuong Uyen.
Many Vietnamese products and goods will be able to increase export turnover thanks to e-commerce platforms .
Untie the knot
Despite some successes, cross-border exports still face many difficulties. According to Ms. Hoang Thi Thanh Tam, the first is trust with customers. Because cross-border transactions and e-commerce transactions do not require customers to meet the business directly, building trust with customers is especially important. The second difficulty is payment and information security. The third difficulty is logistics and supply chain.
According to experts, the difficulty lies in the limited level of participation of Vietnamese enterprises in exporting via e-commerce. Most enterprises are small in scale, do not have enough capacity to build a brand, and have poor resilience to sudden and continuous fluctuations in the market.
Not to mention, human resources in cross-border e-commerce have not yet met the requirements; there is a lack of information on trends and related regulations of foreign markets; skills and knowledge in building business strategies, building brands and protecting brands in cross-border e-commerce are still limited...
Therefore, to sell successfully on international e-commerce platforms, businesses need to understand the consumer behavior of buyers through the brand of choice, the level of trust, convenience and appropriate service, as well as build a prominent brand in the online environment. Accordingly, products when sold on the market need to be packaged beautifully, improve product quality, and use environmentally friendly and sustainable materials. In particular, products must not violate the brand.
To support businesses, the Ministry of Industry and Trade is currently making efforts to develop and perfect the digital trade promotion ecosystem, perfecting corresponding digital platforms for direct trade promotion activities to promptly support businesses, cooperatives and business households to effectively support business in the digital environment.
In addition, diversifying cooperation with domestic and foreign e-commerce platforms to provide timely support to businesses that intend to do business on e-commerce platforms. In addition, gradually building common booths, Vietnam National Booths on major e-commerce platforms in the world to support Vietnamese businesses in promoting their product images to international customers.
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