At a conference held in Ha Noi on Thursday, experts discussed the potential benefits of cross-border e-commerce channels for Vietnamese firms struggling with declining demand in traditional markets due to inflation. Participants highlighted the importance of leveraging these channels to promote exports and expand market reach.

One success story was shared by Me Trang Coffee Joint Stock Company, which had previously allocated a significant portion of its budget towards sending delegations to international exhibitions and fairs in search of customers.

However, the company has shifted its focus to cross-border e-commerce, resulting in a more cost-effective approach and wider access to global consumers. In the current economic climate, such measures may become increasingly necessary for firms seeking to remain competitive in the global marketplace.

Addressing a conference on digital business strategy in the VUCA (Volatility, uncertainty, complexity, and ambiguity) era, jointly held by the Ministry of Industry and Trade and the e-commerce platform Alibaba.com, Duong Khanh Toan, Director of international sales and import and export of Me Trang Company, said they once failed to put the coffee on the e-commerce platform Alibaba.com.

However, they did not give up and decided to conquer this sales channel when the COVID-19 pandemic caused market disruption.

When putting products on the online channel, he said, they determined that e-commerce is not only a sales channel but an inevitable trend if they want to survive in the context of the unstable world market, making the demand in major markets such as the US and EU decline because of inflation.

"If businesses still keep the traditional approach of participating in fairs and exhibitions, they will be very passive in responding to unpredictable developments in the market, especially in large markets with fierce competition," Toan said.

At the same time, the cross-border e-commerce channel helps the company bring its coffee to new markets where they could not have thought that the consumers are very fond of Vietnamese coffee.

Sharing ideas, Vu Ba Phu, Director of the MoIT's Viet Nam Trade Promotion Agency (Vietrade), said digitalising trade promotion activities and the application of information technology are essential aspects of the country's strategy for building a digital government, digital economy, and digital society.

"2023 is a crucial year for Viet Nam to successfully implement the economic development plan in the 2021–25 period," Phu added.

He said within the framework of cooperation between Vietrade and Alibaba, the two sides have coordinated to successfully deploy many international events, which helped introduce reputable brands, quality products, and success stories of Vietnamese exporting businesses.

Over 200 training courses were organised by the MoIT and Alibaba in localities nationwide, focusing on raising awareness of digital transformation, access to digital business methods, how to operate digital pavilions, and online sales.

Businesses need to pay heed to improving and controlling product quality and competitiveness to meet regulations of import markets and coordinate with trade promotion agencies in building plans and joining trade promotion activities to take advantage of opportunities from markets, Phu said.

According to Roger Luo, director of Alibaba in Asia-Pacific, through Viet Nam's export data in recent years, it can be seen that Vietnamese goods are at the top of the world's consumption demand.

More and more foreign partners are willing to consider Viet Nam as the first choice for purchasing goods, Luo said, adding that products of Vietnamese small- and medium-sized enterprises are always highly valued for their quality, export skill as well as after-sales service.

Support needed

However, through preliminary statistics, Phu said that the number of enterprises exporting directly through cross-border e-commerce platforms is still modest, accounting for a small proportion of 200,000 enterprises participating in exporting activities in the country.

The difficulties for the firms were resources, personnel, and technology.

"The best way for businesses to sit in one place and sell products to global consumers is to prepare a high-quality workforce, make sure they speak the native language of the customers, and answer online for 24/24 hours to ensure the finest customer service," he said.

In particular, enterprises need to be proactive and active in understanding information, mechanisms and policies, market research, and partner appraisal, and focusing on improving and controlling product quality to meet the regulations of the import market.

Vu The Tung, director of Business Development and Government Relations at Alibaba Vietnam, said this year, the e-commerce platform Alibaba.com will focus on improving the quality of services to connect exporters and importers and providing information on market demand to increase efficiency when businesses decide to do business on the platform.

Minister of Industry and Trade Do Thang Hai said continuing to promote the distribution of Vietnamese goods through cross-border e-commerce platforms is essential in the current context of high inflation.

The ministry would support Vietnamese enterprises to sell goods on cross-border e-commerce platforms; continue to mobilise the banking system to support export firms with diversified financial solutions.

The report Digital B2B Outlook for Viet Nam in 2023 of Alibaba shows that over 50 per cent of businesses choose to sell their products on e-commerce or digital platforms and expand sale channels to "survive" amid the COVID-19 pandemic. — VNS