The Potential of E-Commerce Industry in Bangladesh | theindependentbd.com


The key factor for development in this new economy is knowledge and details. Innovation and technological change thus make a significant contribution to sustainable economic development.

In the information age, e-commerce is essential for businesses, guaranteeing access to new markets, increasing business growth rates, increasing the versatility of trade policies, reducing sales and advertising costs. . During 2013-2014, the world of e-commerce in Bangladesh started. Over the years, banking communications, logistics and payment methods have increasingly improved, and opportunities have been created by the e-commerce market. Even though e-commerce is still in its infancy in Bangladesh, the industry seems very emerging in the coming days, with more than 165 million inhabitants and 96 million internet subscribers.

Certain factors have driven the growth of the e-commerce industry over the past 4-5 years. The adoption of mobile Internet and the successful use of mobile Internet have been remarkable. The Bangladesh Telecommunication Regulatory Commission (BTRC) announced that in 2017 there were 80.6 million internet users and 91.3 million internet users in 2018. There were 96 million internet users according to data as of June 2019. In addition, the e-commerce sector has expanded significantly by placing smartphones in the purchasing power of the lower middle class. The young and dynamic population of Bangladesh is rapidly popularizing e-commerce websites. About 45% of people are potential e-commerce users. The Covid-19 pandemic has locked the whole world indoors, but that doesn’t mean demand has disappeared from the market. The situation has been embraced by consumers and online shoppers and online sales are known to have increased 70-80% from the general time.

In terms of e-commerce revenue, Bangladesh is ranked 46th globally, according to a study by German online portal Statista. The latest figures from Statista demonstrate that the e-commerce industry in Bangladesh stood at $1,649 million in 2019, rising to $2,077 million this year and will reach $3,077 million in 2023. Statista also reports that the online fashion market in Bangladesh today stands at $598 million and is likely to cross up to $1.24 billion by 2023. Currently, online sales of electronics products are growing amount to 457 million US dollars and furniture and appliances to approximately 196 million US dollars. Furniture and appliance sales would climb to $352 million after four years. Online sales of hobby products and toys amount to $260 million and by 2023, they could reach nearly $442 million. (Source: Statista.com)

Every day in the country, 80,000 families receive services from different e-commerce sites. The Secretary General of the Electronic Commerce Association of Bangladesh (e-Cab), Mohammad Abdul Wahed Tamal, said that during the COVID-19 pandemic, e-commerce has revolutionized. Compared to the previous period, online sales growth increased by 70-80%. Tamal also added that every year the sector almost doubles. A recent report from the Bangladesh Bank shows that there is an upward trend in the transaction amount of Bangladesh’s e-commerce sector every month. In June 2020, the transaction amount was 491.4 Core Tk, which increased to 640.4 Core Tk in July 2020. (Source: Bangladesh Bank)

Economic variables and growth rates are affected by e-commerce. E-commerce transactions increase GDP growth and thus help Bangladesh achieve the Sustainable Development Goals (SDGs). This leads to higher incomes, higher standard of living for individuals, expansion of commercialization, increased sales and exports, thereby increasing production and growth rates. The e-commerce industry in Bangladesh generates tremendous growth in job opportunities. At present, this sector has more than 40,000 individuals and more than 30,000 SMEs (small and medium-sized enterprises). Apart from hundreds of entrepreneurial organizations, about four lakh women entrepreneurs are also selling goods on different online platforms. Five lakhs will work for e-commerce in Bangladesh in the next five years, according to official government statements. “Services are offered diligently by e-commerce companies. Hopefully, e-commerce, marketplace, as well as logistics services have created great potential for young people,” Trade Minister Tipu Munshi said.
With the rise of e-commerce, the startup ecosystem has seen positive growth. SMBs from home can also sell to global audiences in popular marketplaces. The rise in exports is in the lead. Due to the large population of Bangladesh, it is no surprise that e-commerce bigwigs try their best to attract Bangladeshi customers and prepare their strategies to cater to the special needs of the Bangladeshi audience. It has now been learned that Daraz is one of the largest e-commerce companies in Bangladesh which is a 100% foreign investment organization. After them, other Bangladeshi companies are doing well, including Evaly, Ajkerdeal, Rokmari, Pikaboo, Othoba and Chaldal. Amazon, the largest e-commerce company in the world, is interested in Bangladesh.
While the e-commerce industry has grown over the years, many challenges remain. The growth challenges facing the country’s e-commerce sector include lack of appropriate national system support policies, clear roadmaps for e-commerce development, security of financial transactions, internet slow and costly, distribution networks, product quality assurance and a lack of expert human capital. Due to lack of infrastructure and inability to access remote areas, e-commerce businesses cannot reach all parts of the country. Lack of a trustworthy e-commerce environment, lack of public accuracy and fear of online shopping are other challenges.

E-commerce is a growing industry in Bangladesh. The sector is growing and becoming more competitive. Protection should be provided for local e-commerce businesses in the market. Foreign investments in this sector are simultaneously expected. The method of payment offered by e-commerce sites must be secure. High-speed, low-cost internet in rural areas must be ensured. The e-commerce industry should focus more on the logistics of sourcing and customer service. To prevent consumers from being deceived and receiving poor quality products, urgent measures must be taken to guarantee consumer rights. Despite the challenges, the industry has great potential, and in the years to come, e-commerce will play a significant role in the country’s GDP. Under the Digital Bangladesh initiative, the government should further support and fund this sector.

The writer is a student of Noakhali University of Science and Technology.

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