ASEAN-6 MSMEs boost e-commerce exports with Amazon help

Amazon Global Selling (AGS) has released a report revealing the opportunities and challenges faced by micro, small, and medium-sized enterprises (MSMEs) in ASEAN-6 countries as they navigate the global e-commerce landscape.

The report, carried out by Access Partnership and commissioned by AGS, found that B2C e-commerce export revenue in the ASEAN-6 region was estimated at USD $18.9 billion in 2023, with MSMEs contributing 38% of this revenue. The report predicts that by 2028, this figure could rise to USD $30.4 billion, with MSMEs' share potentially growing to 48%.

Ninety percent of MSMEs in ASEAN-6 indicated that e-commerce is essential for their ability to export, pointing out that without it, they would be unable to reach international markets. The United States is highlighted as a top priority destination for these businesses, both currently and in the future.

Anand Palit, Head of Southeast Asia for Amazon Global Selling, stated, "e-commerce unlocks a world of export possibilities for MSMEs and entrepreneurs by offering direct access to a global customer base and a chance to carve their own path on the international stage." He also noted that the number of new Southeast Asian sellers on Amazon U.S. has increased by 50% in 2024 compared to the previous year.

The report also highlights challenges faced by ASEAN-6 MSMEs, with a lack of understanding of foreign export regulations and high logistics costs identified as primary barriers. Nine out of ten MSMEs report that the lack of knowledge about e-commerce import regulations in destination countries hinders their exporting capabilities. The U.S. is the main country where MSMEs seek to bridge this regulatory knowledge gap.

Amazon provides a range of tools and services to help MSMEs overcome these challenges, including educational resources on international regulations and shipping solutions with its Supply Chain by Amazon service. This service optimises inventory placement and enables faster delivery from factories to customers. Additionally, Fulfilment By Amazon (FBA) offers U.S. customers premium shipping at a cost 70% lower per unit than comparable options from other providers.

Alisha Tan, Marketing Director of Galano Furniture, remarked on the benefits of Fulfillment by Amazon, stating, "We have adopted Fulfillment by Amazon (FBA), which has offered us peace of mind in terms of customer service and last-mile delivery. We have seen a remarkable business growth in 2023 and are looking forward to expanding our presence to Amazon Canada, UK, and Germany in 2024."

Vietnamese brand Sunhouse has chosen Amazon as its platform for global expansion. Mr. Le Tung, Chief Marketing Officer of Sunhouse, emphasized the strategic importance of international expansion and credited Amazon with helping the company overcome market entry challenges, stating, "Expanding into international markets is an essential and strategic move for Sunhouse to assert the standing of both Vietnamese enterprises and brands on the global stage. With Amazon's support, we've optimized our cost structure, boosted revenue, and set the foundation for continuous growth over the next three years."

Joseph Zapanta, Chief Operating Officer of Philippine-based Argon40, added, "The main benefit of selling on Amazon is being able to reach customers in the U.S. directly without the necessity of setting up a physical store there. As an emerging brand and a start-up company, selling on Amazon enabled us to be on the same stage as established brands."

The report underscores the value of government-industry partnerships, with over 90% of MSMEs agreeing that such collaborations could assist in navigating foreign markets. Amazon Global Selling is actively working with government agencies in ASEAN countries to support local sellers in reaching global markets. In Singapore, the collaboration with Enterprise Singapore and Singapore Business Federation through the Cross-Border Brand Launchpad Program has helped over 100 local MSMEs, including Everiday Foods, to expand their global reach.

In Malaysia and Thailand, AGS has entered into partnerships with the Malaysia External Trade Development Corporation (MATRADE) and Thailand's Department of International Trade Promotion (DITP), respectively, to support local MSMEs in boosting their e-commerce export capabilities.