Online export: Catch waves to break through

Illustrative photo.

Joining not only helps increase sales and expand production scale, but also makes it possible to import quality raw materials and products from international markets to improve product quality and compete in the market.

Potential market

Based on data collected from a number of reputable organizations in the world and survey results from about 11,000 individual consumers and nearly 10,000 businesses, the Vietnam E-Commerce Report 2023 published by the Department of E-Commerce and Digital Economy (Ministry of Industry and Trade) shows that Vietnamese e-commerce in recent years has recorded strong growth.

If in 2018 Vietnam's B2C e-commerce revenue only reached about US$8 billion, by 2019 it had surpassed the US$10 billion mark (reaching US$10.8 billion). Revenue continues to increase to US$11.8 billion in 2020 and US$16.4 billion in 2022. With revenue reaching US$20.5 billion in 2023, the proportion of B2C e-commerce revenue accounts for about 7.8-8 percent of total retail sales of goods and consumer service revenue nationwide.

According to Amazon Global Selling's assessment, Vietnamese goods have the opportunity to increase online exports as global consumption continues to shift from offline to online. According to Amazon, the expected scale of the online retail market in 2024 is more than US$31.3 billion, accounting for nearly 13 percent of global retail. In the next five years, this number will increase to more than US$40.5 billion, equivalent to 15 percent of global consumption.

According to the e-Conomy SEA 2022 report by Google, Temasek, Bain & Company, Vietnam is in the top country with the highest growth rate in Southeast Asia in terms of online shopping. It is forecasted that revenue and sales volume on Vietnam's B2C online retail platforms will continue to increase strongly, possibly reaching VND650 trillion by 2024. In particular, the top five e-commerce platforms in Vietnam can reach more than VND310 trillion in 2024, a growth of 35 percent compared to 2023.

Increase sales from online sales

According to Mr. To Nghiep Sieu, deputy director of Hanh Sanh Production Trading Service Co, Ltd, 2019 was the first year the company joined the Alibaba e-commerce platform, the business's revenue in the international market has reached US$150,000. With the support of Alibaba.com, the company quickly penetrated into seven countries. Participating in the Vietnam booth on Alibaba.com has helped this brand further expand the scope of commercial activities and strengthen its competitive position.

Mr. Duong Nhu Duc, Director of Ninh Binh Phosphate Fertilizer Joint Stock Company, said that in 2023, the company achieved revenue of VND727 billion, an increase of 4 percent; Profit before and after tax reached VND 34 billion and VND28 billion, respectively, down slightly compared to the same period. With this result, the business exceeded the pre-tax profit plan set by 71 percent. In 2024, with about 70 percent of orders signed, the business is expected to grow by 15-20 percent.

“Fertilizer is a specific product, besides supplying on the domestic market and exporting in the traditional way, the company has exported via cross-border e-commerce on Alibaba. Accessing and promoting exports online helps our company reach more customers, especially markets in Asia, of which the biggest consumers are Malaysia, Indonesia... This result creates momentum for us to increase investment in improving product quality, meeting the standards of import markets and bringing products further," Mr. Duong Nhu Duc said.

To take advantage of digital commerce, recently, the Ministry of Industry and Trade has coordinated with reputable e-commerce platforms with hundreds of millions of buyers globally such as Amazon, Alibaba... to promote promote online exports. In particular, the event of the first 100 typical Vietnamese enterprises participating in the Vietnam National Pavilion on the international e-commerce platform marked a breakthrough for Vietnam's online exports, at the same time, opening opportunities for export promotion on digital platforms.

Vietnamese suppliers selected for this program not only benefit from online visibility through the Vietnam National Pavilion on Alibaba.com but also receive technical support, consulting, training and other support in building and enhancing their business profile on Alibaba.com.

The scope of knowledge sharing covers many aspects of international trade, from e-commerce operations to international shipping, logistics and commercial law.

The program is also expected to open avenues for export growth for participating suppliers through trade promotion events, buyer-seller connections and mutual learning opportunities.

According to experts, switching to selling on online channels will help Vietnamese small and medium-sized enterprises navigate and quickly adapt, take opportunities and develop with cross-border e-commerce. However, to keep up with the flow of cross-border e-commerce, sellers need to understand the consumer behavior of shoppers through the brand of choice, level of reliability, convenience and appropriate service, as well as like having to build a prominent brand in the online environment.