Manufacturing E-Commerce in Pakistan – Trends & Opportunities

Manufacturers – A future full of smart connected products assets and operations offer huge potential for productivity, gains cost savings and sustainable profitable growth and new customer expectations such as mass customization product as a service. Customer of customer requirements create the need to embrace digital technologies across the manufacturing value chain.

Manufacturing Ranks No. 1 in E-Commerce

Manufacturing, Not Online Shopping, Ranks No. 1 in E-Commerce – Ask someone to define “e-commerce” and they’ll likely say: online shopping.

While online retail certainly is a significant player in the world of e-commerce , it pales in comparison to the share of total manufacturing, wholesale trade and services sector activities conducted electronically in USA.

According to the Census Bureau’s 2018 E-Commerce Statistics report, manufacturing e-commerce shipments made up 67.3% or nearly $4.0 trillion of the $6.0 trillion in total value of manufacturing shipments.

Manufacturing E-Commerce

Just like the retail trade sector, Manufacturing e-commerce includes online orders from customers. However, these orders include purchases from both traditional consumers and other domestic establishments of the same company that in turn manufacture, assemble or fabricate the product.

For example, electronic orders of components by an automobile assembly plant from a parts manufacturer owned by the same company would be counted as manufacturing e-commerce.

E-commerce can be conducted over the internet but also includes sales made using extranets, Electronic Data Interchange (EDI) networks, email or other online systems and payment may or may not be made online.

The price and terms of manufacturing e-commerce shipments can also be negotiated on these platforms.

Manufacturing businesses have embraced e-commerce because it streamlines the process of purchasing and selling components and products to other businesses.

The automobile assembly industry is a prime example.

The industry adopted “just-in-time” manufacturing years ago. Under this process, components needed to build cars are delivered to the assembly plant right when they are needed. This helps reduce the need for large parts inventories and warehouse space to store them.

To make this process efficient, the assembly plant maintains an electronic data interchange with parts suppliers to order parts exactly when they are needed.

The Future of E-Commerce in Manufacturing?

Manufacturers embraced e-commerce for some of the same reasons as the wholesale and services sectors: It allows them to simplify business processes and streamline relationships with downstream customers and upstream suppliers.

Businesses that supply inputs to manufacturers don’t have to wait for paper order forms to be received and processed.  Orders come in electronically and can be processed immediately.

These businesses can also more accurately schedule their transportation systems. This has been especially important during the coronavirus pandemic, when supply chain challenges have often hampered the ability of health care providers and emergency managers to quickly respond to the impact of the pandemic on residents and businesses.

These supply chain improvements also cascade downstream: Individuals receive their online orders quicker and more accurately.

Pakistan’s Scenario of E-Commerce

Pakistan is the 37th largest market for eCommerce with a revenue of US$6 billion in 2021, placing it ahead of Iran and behind Israel. With an increase of 45%, the Pakistani eCommerce market contributed to the worldwide growth rate of 29% in 2021. Revenues for eCommerce continue to increase.

In Pakistan, e-commerce tends to be dominated by business to consumer (B2C) companies. There are three main sectors, general e-commerce, groceries/quick(q)-commerce and fashion. The most fiercely contested current sector in Pakistan is quick commerce/groceries, where Food Panda and Airlift are the two big companies battling it out for market supremacy. Both have adopted the dark store model which requires a limited number of stock keeping units (SKUs) being stocked in different strategic locations spread across different neighborhoods,

In a developing country like Pakistan, where the majority of exchanges and transactions are directed in cash except those involving large sums of money requiring bank drafts or pay orders, e-commerce faces a host of challenges such as payment methods, taxes on information and communications technology items, absence of guidelines about online payments, lack of trust, slow or less adaptation of mobile and online payments, online payment frauds, unavailability of credit cards to a large portion of population, poor quality of electricity infrastructure and unauthentic websites.

Web-based business packs a huge potential and there is an urgent need to address the above-mentioned serious challenges giving more space to this mode of trade to grow and expand.

Why every manufacturer should have an e-commerce marketplace store?

Manufacturer should have an e-commerce marketplace store for their business.

Manufacturers constant efforts go into:

While most of Manufacturer have the expertise of controlling situations within their production floor .There is a constant struggle to widen visibility in the market and often rely on traditional marketing methods to increase sales.

In this digital era where internet and smartphone penetration are increasing by leaps and bounds it is important to tap into the digital resource and use them to widen your business scope.

E-commerce marketplace

Ecommerce has transformed the manner in which businesses sell their products and services it has blurred the lines between businesses and their customers across b2b and b2c segments and opened up new opportunities on a global scale to buyers are completely aware of what they want and explore various ecommerce marketplaces .

Let’s look at some trivia almost half of the Earth’s population have access to and use the Internet out of them 7.5 percent of Internet users are in the United States of America but not all of us population have access to the Internet and that’s 88 percent of the total population which is still huge buying products online have also picked up quite a suite in the b2b segment and the number goes on increasing global b2b e-commerce sales are predicted to reach over six point six trillion dollars by 2020

Out of this one point nine trillion dollars worth of b2b business would be done in US alone currently it stands at 928 billion dollars in 2017.

Now imagine the enormous potential e-commerce marketplace and a direct website holds for your business how do you kick start your first e-commerce platform adopting an e-commerce platform for

Look at a scenario a customer visits your e-commerce marketplace searches for the relevant product and views the details. The integration between ERP and your marketplace ensures that the customer views up-to-date information such as product availability latest price and tentative delivery date. If the product is in stock he places an order and gets the order details via commerce platform

It greatly expands your ability to directly connect with potential customers buried businesses and retailers from across the globe in a short span of time imagine your store being open to customers 24 by 7 and not just during the day the convenience of your customers looking at your products online and place an order instantly at any time from any place boosts your production and business numbers considerably.

An e-commerce platform holds a treasure trove of useful customer data for you in depth details of customer buying patterns and demographic information can help you to make crucial changes to sales forecast production planning also you can make critical decisions on product enhancements logistics pricing changes marketing strategy and much more customers enter the order details themselves decreasing the chances of errors the human intervention is less as data automatically flows between the marketplace and back-end systems leading to increased data accuracy and smooth operational control. Inventory updates are instantaneous on each order thereby ensuring correct information is available to customers and business owners at all times having an online marketplace increases Manufacturer ability to promote their brand designing the marketplace in accordance with CEO guidelines.

Magic of Direct Contact

Product details crop up in the initial search results every time a potential customer searches for the relevant product this increases the visibility of the business leading to more customers more trust. Friend recognition and growth customer relationship improves drastically as they can all the products place an order directly contact raise request for quotation keep a status update of their orders and shipment and provide critical product feedback on the ecommerce site itself. – For further Reading..

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