Ecommerce is expanding rapidly in Pakistan and it is becoming a major trend among the people who use internet, as per the official sources.
The trend is increasing due to proficiency of authentic website or portals where the sale and purchase are good. However, speedy-internet connectivity and availability is also one the biggest factor for increasing Ecommerce in Pakistan.
The question that comes in minds for the beginners of internet users is; what is ecommerce? E-commerce is known as the commercial transactions that are conducted electronically via internet. In easy words it is simply the buying and selling of goods or services through online services via the internet.
However, it is also the transmitting of the funds or even data through an electronic network, significantly the internet. These business transactions that are in the ecommerce category occur either as the B2B- business-to-business concept or as the B2C- business-to-consumer and not only this but also C2C- consumer-to-consumer or the C2B-consumer-to-business.
Ecommerce is becoming a major contributor to the economy of Pakistan. Pakistan has been on a mission for quite a long time to stir up its economy and make a strategic plan to accomplish a broad commercialization. Somewhat, the arising IT area like in overall IT sector, development in populace of the country and the development of individuals utilizing the internet have upheld this mission.
Usually people ask how to start ecommerce business in Pakistan? It is perhaps very easy if you first do your homework in the field of business you are stepping into. If you want to sell any specific product or offer any service than you must need to know the in0depth details of it to avoid any misleading information.
However, you can also sell your product to the online search engine or e-commerce sites like Daraz.pk or shoppingum.com, etc. Or you can simply create your own brand’s official website along with the social media accounts of Facebook, Instagram, etc.
History of Ecommerce in Pakistan
The E-commerce in Pakistan was started around two decades ago with a ban of the PayPal service in the country. The ecommerce companies and the merchants of this field had to rely on the cash on delivery as well as the bank payment methods. However, the need for the alternative of PayPal was fulfilled to an extent by the launch of the mobile payment systems the country.
Ecommerce industry in Pakistan
According to the Ministry of Commerce, E-commerce market size of Pakistan has recently posted up a growth of about 35 per cent in only the first quarter of this fiscal year of 2021 that is to Rs. 96 billion as compared to the value of Rs.71bn that was in a period of the last year.
Pakistan is a country where starting a small business is not so difficult and nowadays many people are doing it, some are doing business of clothing, home-made food, selling kitchen goods, or many other things online. They have created their websites and social media accounts where the selling and purchasing of goods is successfully done.
Pakistan is a developing country where the technology is increasing on a fast pace. The Federal Board of Revenue also conducted a meeting recently where the FBR informed about the legal framework and updates including the Ecommerce rules and terms regarding its mechanism of import goods clearance, as well as the return of goods policy along with WeBOCs’ e-commerce module.
The National Taxation Council is also working on agreement of taxation regime almost in all the provinces of the country and federation. However, the State Bank of Pakistan also gave presented a presentation on its efforts on promoting the cross-border e-commerce in which its pros and cons were also included.
The development of the sector of e-commerce in the entire world has now made it possible for economic development. Globally E-commerce has grown enormously in the past two decades with a growth rate of sales standing on 13% that equates to the sales that also worth an estimated value of $2.9 trillion. However, these figures are expected to grow up to $4.5 trillion by this current fiscal year of 2021.
Online shopping is expanding and so does the ecommerce platforms. There are several studies that confirm about 18% of all the online retail of sales in Pakistan that took place in previous years.
Challenges of Ecommerce in Pakistan
E-commerce is facing many issues like challenges that include the payment gateways, multiple taxes on the Information and the Communications Technology products as well as the lack of regulations of e-payments and lack of ICT’s infrastructure.
The E-commerce security, privacy, as well as the trust is a critical issue that promotes negative impacts on expansion and the development of this E-commerce sector in Pakistan.
Few common challenges are as follows:
- Lack of trust issue.
- Slow or less adaptation of the mobile or online payments.
- The online payment frauds.
- Online shopping cart abandonment.
- Lack of the favorable reviews.
- Poor shopping experience.
- Counterfeit products selling.
- Unauthentic websites.
- Finding the right product to sell.
- Attracting the targeted audience.
- Generating more traffic.
- Retaining customers.
- Achieving long-term profitable growth.
- Use of latest technology and implementation of it.
- Imposition of taxes
- Lack of information in native languages
These challenges are faced not only by the consumer but also the sellers. Many fake accounts are dealing which are unauthentic and people who got first bad experience from online shopping always think twice to purchase anything online for the second time, even from any new or other platform.
Forecast has shown that in the upcoming years like the year, 2040 it is expected that about 95 percent of overall retail sales as well as purchases will be made online while resolving the challenges and hurdles that are faced in the current period.
Moreover, there are several other issues like poor quality of poor quality of the electricity infrastructure, the power shortage and low investments in the IT that can else to get more convenience and ease for online shopping.
Opportunities of Ecommerce in Pakistan
Ecommerce policy needs to be followed by every ecommerce platform in Pakistan. However, many people can do Ecommerce business and are still doing it for their earning. The opportunity is open for all because the online social media sites are usually free and through that you can sell any of your product or service in which you have expertise or can provide what you offer.
In Pakistan there should be an enabling environment in order to provide ecommerce growth to the higher level. A huge opportunity of ecommerce is for youth and especially female entrepreneurs who wanted to do their online business from home. These platforms also created jobs for many where the whole supply chain is set from raw material, manufacturing to taking online orders and delivering to the customers.
It is perhaps a great opportunity to enter in the ecommerce market if you are willing to do your own business. Many of the existing retails have also shifted or expanded their business by selling their products and services online along with the physical selling, especially brands.
Daraz.pk, Shoppingum.com, Zameen.com and OLX are also among the top E-commerce platforms where anyone can add their product even property to sell and many of the customers are there to negotiate or to purchase the products on the price demanded.
Other benefits or opportunity includes:
- Opportunity for everyone to start their own business from home (especially women).
- Expand the global reach.
- No time limit because online shopping platforms are usually 24/7 open for shopping online; however, the physical retail stores have a limitation of timing.
- Fuel cost is also saved but your order is just a click away where you can simply order online while sitting at your home and can save the traveling cost that is in utilize in for the fuel.
- Online discount offers.
- Security and data protection of data.
- No necessarily need of physical store or warehouse.
- Many open choices to set up the business.
- Independence of setting location for customer and seller.
- No cash handling required as you can pay online in electronic form.
- It creates more employment opportunities.
Future of Ecommerce in Pakistan
The future of E-commerce is expected to be on the bright side with more opportunities and expansion. The contribution of e-commerce sector in the economy of the country is also expected to be increased during this year and in the upcoming years. Scope of ecommerce in Pakistan is also anticipated to grow more in the upcoming years as the trend will increase.
E-Commerce industry in Pakistan would surely give Pakistan a sector that would easily help all the residents work towards their national perception of the wealth and with their untapped potential as this is something that will surely benefit the people of the country.
It can surely provide Pakistan with an ideal way to even cover a vast distance of the country as they cover all the process of the social as well as economic development that is coupled with the technological development in a very short span of time. According to an official report, by 2022 Pakistan will be observed at a 25% increase in the overall exportation of IT information technology and due to this the ecommerce will also grow.
E-commerce will also contribute more majorly in improving livelihoods of the people and also in building competitive enterprise as well as increasing the shares in global trade. However, in regard to this as increasing global trade of Pakistan and closing digital divides that is currently a hurdle like a barrier between the developed and developing country of the world.
Moreover, there are essential facts and things that need to be set and put in a place which will surely enhance the competence as both like materially and subjectively. However, the best ecommerce websites in Pakistan are also expected to grow more and to expand the business with international borders.
The youth in today’s era is far happier to embrace the technology in a new way then the older generation; however, the promotion as well as the regulation of e-commerce will also be more significant like in terms of providing the employment opportunities for about 130 million people over the next upcoming 30 years period in Pakistan.
