Amazon releases report on e-commerce export opportunities for Singapore SMEs at inaugural Seller Boot Camp

• Huge potential
  for local SMEs with B2C e-commerce export value in Singapore forecast to grow
  from S$1.4B in 2021 to S$3.5B by 2026, per Amazon’s first-of-its-kind report
• 87% of SMEs find
  e-commerce critical to expand globally, with greater sales growth expected
  overseas than domestically, reveal report findings

SINGAPORE – Media
OutReach – 11 October 2021 – (NASDAQ:AMZN) – The annual value
of business-to-consumer (B2C)  e-commerce
exports in Singapore is estimated at S$1.4 billion in 2021 and could
reach S$3.5 billion in 2026 if micro, small, and medium-sized enterprises
(MSMEs) accelerate their pace of using e-commerce to sell overseas. Currently,
MSMEs are estimated to contribute 45% of Singapore’s B2C value of e-commerce
exports in 2021.

 

These are
findings from Amazon’s new ‘Local Sellers, Global
Consumers: Capturing Singapore’s e-commerce export opportunity‘ report, which surveyed over 300 MSMEs from
Singapore, and was
released at the inaugural ‘2021 Amazon
Expo, Seller Boot Camp‘. The report, prepared by consulting firm AlphaBeta, is the first-of-its-kind
in analysing the size of Singapore’s e-commerce export potential, the
perspective of local MSMEs, and best practices to achieve that potential.

 

Over 3,000 SMEs
from Singapore, Malaysia, and the Philippines are expected to join this Seller Boot Camp, a 3-day virtual
event hosted by Amazon from 11-13 October 2021, to equip themselves with the tools, resources, and knowledge to seize
cross-border opportunities, increase their customer reach, and expand
their business globally. During the event, Enterprise Singapore’s (ESG) Executive
Director (ICM & Digitalisation), Mr Lee Yee Fung, will also share how the Singapore
government and industry experts are working together to help local businesses
unlock opportunities with e-commerce.

 

Mr. Bernard Tay,
Head of Amazon Global Selling, Southeast Asia, said, “We are on a mission to help MSMEs start
local, grow global. Local businesses of any size can benefit from this report to
understand a range of topics, from business models and export regulations to
consumer needs and foreign competition. Along with the report insights, our
first-ever Seller Boot Camp comes as a timely opportunity for small enterprises
to identify the current gaps in their operations and arm themselves with the
knowledge, resources, and connections to sustainably expand their business. Not
only can MSMEs learn from Amazon, but they can also connect with Enterprise
Singapore and our key partners to glean insights, additional support, and an
expanded network to grow globally.”  

 

Sizeable regional growth opportunities for
e-commerce exports

According
to the report, if current e-commerce adoption trends continue, the annual value
of B2C e-commerce exports in Singapore is expected to grow at 5% per
year to reach S$1.7 billion in 2026, from S$1.4 billion in 2021. However, if
MSMEs accelerate their use of e-commerce to export, this value is projected
to increase more than two-fold and reach S$3.5 billion in 2026.

 

Singapore
MSMEs surveyed anticipate greater sales growth prospects overseas (35%) than at
home (13%), with Asia Pacific countries – Malaysia, China, Australia, Indonesia and Thailand – seen as the top five e-commerce export markets in five years’
time, by 2026.

 

Currently, close
to one-quarter (24%) of MSMEs in Singapore conduct B2C e-commerce, of which,
more than 90% use it for export.

 

87% of those surveyed locally agreed that e-commerce is critical for their ability to
export, with top motivations including the ability to reach overseas customers,
access to sales and marketing tools that are available on e-commerce marketplaces,
and support for logistics and payments provided by these marketplaces. For 35%
of surveyed Singapore MSMEs that export via e-commerce, more than half of their
annual e-commerce sales were generated from
abroad.

 

Key challenges faced by local
MSMEs in e-commerce exports

Amidst the
opportunities for growth and global expansion through e-commerce, MSMEs surveyed in Singapore
revealed that key challenges can be narrowed down
to three categories – barriers in cost, regulation, and information and capabilities.

 

High cross-border
shipping costs is the most common challenge faced by Singapore MSMEs surveyed,
with 81% citing it as a major barrier. While Singapore offers a robust range of
grants to support local businesses on their e-commerce export journeys, about
one-third of small enterprises (32%) surveyed admitted that they will find
further support valuable.

 

Additionally,
over three-fourths (78%) of MSMEs surveyed cited a lack of clarity in import
regulations as a key barrier to selling overseas via e-commerce. Only 19% believe that current advisory
support on importing regulations is sufficient.

 

Lastly, 72% of MSMEs
surveyed believe they lack the ability to compete with other sellers globally,
and 71% admitted that they are unsure of foreign consumers’ demands and
preferences.

 

Tackling current challenges: Start local,
go global with Amazon

Amazon offers
various resources for thousands of local sellers to tackle their current
barriers and complement existing efforts by industry and government agencies.

 

Most recently in
Singapore, Amazon launched its IP Accelerator programme to make it easier and more
cost-effective for small businesses to protect their brands by obtaining
trademarks and tackling goods infringement in Amazon’s stores. ESG will also
support Singapore businesses defray some of the costs associated with internationalisation,
such as Intellectual Property Protection services in North America offered
under the Amazon IP Accelerator programme.

 

Enterprise Singapore’s Executive Director
(ICM & Digitalisation), Mr. Lee Yee Fung, said, “Key players
in the e-commerce landscape, such as Amazon, have an established ecosystem of
solution providers and suite of resources to assist sellers in deepening their
digital capabilities for market expansion. We hope participants at the 2021
Amazon Expo, Seller Boot Camp will take the opportunity to acquire new
knowledge about selling overseas and tap the range of support that can help
them do so. We look forward to partnering more Singapore businesses to grow
their sales avenues and international footprint through e-commerce.” 

 

Amazon has
supported many homegrown businesses such as Hegen, Malt and Wine Asia, and Tack.
Details on the success of these MSMEs is included in appendix A.

 

To further help
sellers manage cross-border shipping costs and logistics, Amazon’s over 225
tools also include the Fulfilment by Amazon (FBA) service through which Amazon
picks, packs, and ships products, as well as takes care of customer service and
returns, across its 20 stores globally. Locally, Amazon is also waiving its
monthly seller subscription fees until 31 December 2022^[1].

Other resources
include the Amazon Seller App for local sellers with accounts on
Amazon.sg to track sales and manage their business via mobile, the Marketplace Appstore, a one-stop shop to discover third-party
applications and services for automating tedious business aspects, and the Seller Forum, a resource for first-hand advice from
fellow business owners on selling with Amazon.sg. Sellers can also join the Sell on Amazon Singapore
Facebook page to connect with
the community of sellers on Amazon.sg. These resources are in addition to easy
listing tools, payment processing and credit card fraud protection, and
promotional features that businesses of all sizes on Amazon.sg can use to be
discovered by customers and improve sales.

 

Over the three days at 2021 Amazon Expo, Seller Boot Camp, MSMEs can
hear from industry experts and Amazon’s partners who will dive into topics
ranging from cross-border e-commerce and payments to customer and sales
conversion strategies, to help small businesses scale globally and improve
customer reach.

 

To
download the ‘Local Sellers,
Global Consumers: Capturing Singapore’s e-commerce export opportunity’ report, visit https://alphabeta.com/our-research/capturing-the-e-commerce-export-opportunity-in-singapore/. A
full report which includes findings from other ASEAN countries will be released
at a later date.

To
learn more about the small and medium-sized businesses growing with Amazon.sg,
visit: https://amazon.sg/shoplocal. More information about selling on Amazon
can be found here: https://www.amazon.sg/sell.

 

 

Appendix A: Success stories
of local small businesses selling on Amazon.sg

• Hegen: In April
  2020, Hegen started retailing its products on Amazon.sg and has since seen
  steady growth in revenue. During Prime Day 2021, Hegen sold 5x as many products
  as compared to a year ago. Aside from Singapore, Hegen also sells its products
  on Amazon.com and Amazon.uk to reach a global audience online.
• Malt and Wine Asia:
  By selling via Amazon, the brand has been able to offset its initial onboarding
  costs of selling online, upskill digitally to build its e-commerce
  capabilities, and navigate the disruptions caused by COVID-19. It also uses
  Fulfilment by Amazon (FBA) to deliver products to consumers and overall, has
  boosted sales by 3x in just 5 months.
• Tack: Founded
  in 2019, Tack started selling on Amazon.sg in April 2021 and within 5 months,
  expanded internationally via Amazon.com – all while being based in Singapore.
  It is now eyeing a global expansion with Amazon and expects its shoppers on
  Amazon.com to contribute to 25% of its GPS’ sales in the first year, followed
  by a 40% growth in its GPS’ sales in the next year.