THE Department of Information and Communications Technology (DICT) will soon partner with the Department of Trade and Industry (DTI) to promote best practices in e-commerce among exporters.
Undersecretary for DICTs Regional Operations and Countryside and ICT Industry Development Monchito B. Ibrahim said the partnership upgrades one of the agencies’ projects which currently links 2,000 micro, small and medium entrepreneurs (MSMEs) with strategic outsourcing partner-firms.
“We’ll be working with DTI’s Export Marketing Bureau… we think e-commerce will be more effective for the exporters,” Mr. Ibrahim told BusinessWorld on the sidelines of an event in Makati City.
“We’ll probably do the training. And then they will take charge of identifying which is the right market for our exporters,” he added.
He said DICT’s role will focus on honing exporters’ digital marketing strategies to help them be noticed online.
“More importantly, it’s not just trying to build online presence. It’s how to digitally market your products… Digital marketing is very important. They need to learn it. That’s where we can win,” Mr. Ibrahim added.
He said the growth of Philippine MSMEs is lagging those in other Southeast Asian countries due to the country’s “very very low adoption” of e-commerce technology.
“Look at Vietnam, what helped their MSMEs grow? It’s actually E commerce,” Mr. Ibrahim said, adding that MSMEs from Vietnam, Laos, Cambodia and Myanmar re active in e-commerce platform Lazada.
Although he noted that e-commerce may not be the solution for all MSMEs, especially those serving small targeted areas, “for exporters, it will be the most important multiplier, increasing the market access.”
The Asian Institute of Management’s research arm, Rizalino S. Navarro Policy Center Competition (RSN-PCC), recently released a 2018 SME survey, “Drivers of SME Competitiveness in the Philippines” which found that 94.8% of the 480 respondent-firms it surveyed use digital tools in their businesses to various degrees.
A total of 39% said digital tools are very important for finance and accounting purposes. Other important aspects that digital tools can improve are operations, customer relations and inventory management.
However, SMEs had limited exposure to more advanced technologies for business such as cloud-based tech, digital payments, credit and debit card transactions, and social media use.
“SME productivity can benefit more from levelling-up their usage of more advanced technologies such as cloud-based tech, digital payments, credit and debit card transactions, and company websites,” the RSN-PCC survey found.
“Increasing awareness of the benefits of these technologies, even the use of social media for business, can influence SMEs to use these technologies to increase their productivity,” it added.
Mr. Ibrahim said the DICT and DTI may first focus efforts in the Caraga region where exporters, based on the DICT’s own rural MSMEs-linking project, showed “tremendous” potential for e-commerce.
“We are still studying it but I think and really believe this will be a significant solution to be able to bring our MSMES to be significant global players.”
In 2016, MSMEs accounted for 99.6% of operating firms in the Philippines, while contributing 4.9 million jobs or 63.3% of the total that year, according to the Philippine Statistics Authority.
The PSE estimates that MSMEs account for 25% of the Philippines’ total export revenue while 60% of all exporters in the country belong to the MSME category.
Most MSMEs are able to export via subcontracting arrangements with large firms, or as suppliers to exporting firms. — Janina C. Lim