Small and medium-sized enterprises are missing out on e-commerce boomLack of linkage between e-retailers and producers prevents homemade goods from being featured on online platforms, say entrepreneurs.
The differently-abled entrepreneur from Nayapati, Sundarijal had heard that online stores could help him sell his soap as demand for homemade products was rising, particularly among online shoppers.
But Magrati has no way of reaching these potential outlets for his soap. And because of the lockdown, he cannot go door-to-door to sell his product.
E-commerce has been growing steadily in Nepal, but because of lack of proper linkage between e-retailers and producers, like Magrati, many homemade goods produced by small and medium-sized enterprises do not find a market even though they provide a livelihood for many families.
The online marketplace, which saw a sharp rise in sales during the lockdown because people were confined to their homes, has not been able to promote locally produced goods, according to entrepreneurs.
Products like apparels made of Dhaka, allo items, readymade garments, food items and others produced in different parts of the country have not been able to attract online sellers.
“If there is proper linkage between producers and e-retailers, it will be a big help for small and medium entrepreneurs to market their products,” said Kedar Rajbahak, owner of Bishnu Devi Confectionery that makes swirl candy.
Rajbahak has been selling his candy through online marketplace Daraz. “There is good demand for candy,” said Rajbahak, who has been selling most of his goods through the online platform for a year.
Umesh Prasad Singh, acting president of the Federation of Nepalese Cottage and Small Scale Industries, said there are many online platforms, but they are not very keen on selling goods produced by small and medium-sized enterprises.
“Hardly 10-15 percent of homemade goods are showcased on online marketplaces,” he said. “And only a few of them buy such goods as they know the value of the products,” he added.
Amun Thapa, founder of online platform Sasto Deal, said that due to the digital divide, it was a challenge to get to know such products and feature them on their websites.
"E-commerce firms based in the Kathmandu Valley should expand their business to the regional level so that locally produced goods can be sold through online platforms," said Thapa.
He said that despite the huge market potential, products made by small and medium-sized enterprises were not reaching the market due to lack of knowledge about market trends.
Online shopping is spreading due to Covid-19 with people preferring to stay home and buy on the internet. Small and medium-sized enterprises would get a big boost from this development if they were properly connected with online platforms, said Singh.
Most of their products are traditional and skill-based which cannot compete with slick imports, he added.
Though the products are good, people don't notice them due to lack of packaging and marketing, Singh said. “But online platforms can be helpful,” he added. “We are not able to request online platforms to list our products also because output is small.”
Singh said that the reliability of these platforms was still questionable, and there were no laws regulating online business.
Dharma Raj Shakya, past president of the Federation of Handicraft Associations of Nepal, said that as the global market has been impacted by Covid-19, this can be an opportunity to promote domestic products, and online platforms can help increase sales of Nepali handicraft.
As the government has not formulated policy to place Nepali products on online platforms, they have not been prioritising domestic products as they should. Nepali goods are popular on international online platforms, but that is not so in the domestic market.
Consumers seem to be aware of Nepali products, but they still prefer imported goods; and as a result, locally made items are yet to become popular. “Online platforms focus on cheap products and do not feature expensive items,” he said.