E-commerce growth in Pakistan has been rapid in the last few years and the lift that COVID-19 pandemic has brought to e-commerce and online marketplaces has made them crucial for businesses and brands. Pakistan has been added by Amazon to its seller’s list which essentially means that local Pakistani sellers can now list and use Amazon’s platform to sell globally. Getting listed among sellers on Amazon could not have come at a better time as it could be a massive boost to the country’s e-commerce landscape. Mind you, this opportunity is only for sellers; buyers will have to wait till a time the e-commerce giant sees a potential market in the country for opening offices officially.
Nonetheless, the benefits of being able to sell on Amazon are vivid and many. Apart from a boost to the general e-commerce segment, the move is expected to open doors to new opportunities from increasing market size, diversifying markets, increasing revenue potential to a boost for local brands, local manufacturers, SMEs, startups, entrepreneurs, and exports. Not only that; local platforms are also expected to improve once the floodgates of competition open. Also, selling on Amazon is much easier than setting up your own website and selling online; it offers the benefits of an online platform with access to a global consumer base along with tools and infrastructure needed to so.
And then there are affiliate benefits; local banks, fintechs logistics, distribution etc. also stand to benefit from the expanding global exposure.
However, this global opportunity comes with challenges that very few are aware of - or are pointing it out. Despite the ease it offers, selling on Amazon is not as simple as majority is portraying – at least for a country like Pakistan where e-commerce is still in nascent stages and sellers are unsophisticated.
Despite the incredible consumer reach that selling on Amazon brings versus any other local marketplace, there are at least as many failures as success stories - especially for SMEs and individual sellers. Local sellers will need to up their game including their know-how of technology. Selling on a global platform of Amazon’s stature means following strict guidelines and codes. Offering quality in products and service including customer service (returns and refunds where applicable) will have to be top notch to stand a chance against global competition.
Fears generally associated with selling online include both the logistics and tech capabilities of the sellers as highlighted by MR Daraz in a recent interview with BR Research. Logistics and distribution will have to be figured out, while marketing and communication by sellers on the platform will at least require a basic knowledge of SEO and listing. These could be tedious tasks for first time sellers and aggressive training and facilitation will be required is all aspects like Amazon’s pricing and costing structure, relationship and logistics models such as 1P 2P and 3P, product and buyers’ description and information dissemination, or unfair practices that largely go unnoticed in local marketplaces.