E-Commerce Starting to Take Off in Pakistan

Guest Post by Monis Rahman
Founder, Chairman and CEO of Rozee.pk

Pakistan is late to the party. E-commerce is booming throughout our immediate region. India's leading e-commerce website, Flipkart, recently raised a record $1 Billion in new investment, handling 5 Million shipments each month. The website sees so much potential in mobile shopping that it has a stated goal of becoming "the mobile e-commerce company of the future".



To our north, China's e-commerce leader, Alibaba, set a global record when it listed its shares on the New York Stock Exchange in September. Alibaba's Initial Public Offering raised a staggering $25 Billion, making its record-breaking IPO the biggest in the world. Today the Chinese e-commerce giant's market capitalization is over $250 Billion exceeding that of Wal-Mart, the world's largest old economy retailer. The market value of e-commerce companies in Pakistan's immediate vicinity including Turkey, the Middle East, India and China exceeds half of a trillion dollars.



But the party has indeed finally started in Pakistan as well. By 2017, the size of our e-commerce market is expected to reach over $600 Million from it's current size of $30 Million spent on online purchases annually. There are several factors driving this growth, which will dramatically change the way we buy things over the next several years.
Growth of Internet Penetration

Pakistan's Internet penetration rate historically exceeded that of India until 2009. In 2009, India launched 3G and its Internet penetration sky-rocketed. The same hockey stick growth took place in Sri Lanka's after its 3G launch in 2006. With Pakistan's long awaited entry into the 3G club a few months ago, there will be a similar burst of Internet accessibility which will further catapult online purchases.



Following the pattern of our neighbors, Pakistan's Internet enabled population will increase from 30 Million users today to 56 Million in 2019. Over the next five years, 28% of the country's citizens will have Internet access. This unprecedented reach will transform not just how consumers purchase goods, but will also significantly impact several other industries. My own online jobs classifieds site, ROZEE.PK, today processes 40,000 job applications a day and has helped over 1 Million people find jobs. Social media sites including Facebook and Twitter are transforming how we consume news and shape opinions.

Ubiquity of Access through Mobile

Along with the rise of Internet accessibility through 3G, Pakistan is simultaneously witnessing a surge in smartphone usage. There are an estimated 9 Million smartphone users in Pakistan, using handsets that are fully equipped with web browsers and online connectivity. Smartphones have become increasingly sophisticated, not only substituting many functions previously only capable through desktop and laptop computers, but also greatly increasing the ease of going online. Not only is the Internet becoming more accessible to consumers, consumers are also becoming more accessible to Internet merchants through the ubiquity of the smartphones in our pockets.

While the growth of smartphones in Pakistan is linked to the rise of Internet penetration, it is more so driven by the declining cost of increasingly sophisticated devices. Chinese companies which have traditionally manufactured devices for the world's leading mobile phone brands including Apple and Samsung, are now OEM'ing their own handsets for a fraction of the cost powered by Google's Android operating system. So significant is this trend that Samsung's third quarter profits fell by 50% as its mobile business continued to lose ground to low-cost Chinese smartphone makers.

The sub Rs. 5,000 price point of relatively powerful smartphones in Pakistan is enabling online accessibility to penetrate a lower untapped income strata of society. My cook now downloads recipes from the Internet on his smartphone.

India's Flipkart sees so much potential in mobile shopping that it has a stated goal of becoming "the mobile e-commerce company of the future".

Online Payment Initiatives Are Mushrooming

While over 95% of online purchases are fulfilled through Cash on Delivery (COD) in Pakistan, several promising initiatives are underway which will make it easier to pay directly online. Many banks and telcos alike have launched branchless banking and m-commerce initiatives ranging from MCB Banks's MCBLite, Telenor's Easy Paisa, Mobilink's Mobicash, Zong and Askari Bank's Timepay, UBL's Netbanking and others. The number of branchless banking agents which facilitate offline payments for online purchases tripled from 41,000 in 2012 to 125,000 in 2013, making it increasingly easier and more convenient to transfer money.

One of the most frequent complaints from Pakistan's online sellers of not being able to get merchant accounts that allow them to card payments online, has been abated. While Citibank Pakistan was once the only bank in the country to offer online merchant accounts, it was also notoriously difficult for businesses to get approved. When the bank wrapped up its consumer banking operations in 2012, it left its approximately paltry 14 approved merchants high and dry without an online card processing facility. However, UBL has since launched its Go Green Internet Merchant Account product for businesses which is far more reasonable in its on-boarding criteria. Online merchants can now potentially collect payments electronically from 12 Million debit cards in Pakistan.

Perhaps the most successful online payment solution currently available in the country is Inter Bank Fund Transfer (IBFT). A large volume of payments are made by consumers directly going to their bank's website to electronically transfer funds to online stores. Most banks are now offering their customers net banking IBFT payment facilities through their websites, bringing a majority of the country's banked population into the fold of electronic payments.

Maturing Logistics and Parcel Delivery Infrastructure

Currently 95% of online purchases are paid for through COD at the time the parcel is delivered to customer. TCS, BlueEX, Leopards and other couriers are providing COD delivery services across over 150 cities in the country. This becomes especially relevant when considering that approximately 35% of the the country's monthly 70,000 COD shipments are delivered to cities outside the three main urban centers of Karachi, Lahore and Islamabad. While urban shoppers are more online as a percentage of population, the value for rural shoppers is higher as many products are not available in their local markets. This implies a huge untapped segment of the population that will increasingly transition to online shopping.


Growing Trust in Online Storefronts

One of the main obstacles to the growth of e-commerce is the lack of consumer trust in purchasing from the "cloud". As a dotcom entrepreneur in Silicon Valley during the 1990's, I recall the prevailing conventional wisdom at the time: people would never give their credit card information on the Internet to buy items. Today, over 72% of Internet users in the US are digital shoppers. This contrasts sharply with less than 3% of Pakistani Internet users who have bought goods online. Although we have a long way to go, there is correspondingly huge upside potential as well.

After initial hesitation, an inflection point in consumer behavior was reached in the US during the late nineties with strong online storefront brands such as Amazon taking to mainstream media. The large amount of investment these sites were able to raise, coupled with highly professional teams, led to positive shopping experiences for the risk averse early adopters who ventured to buy online. We will see this same pattern in Pakistan.

For the first time in the country's history, we are seeing online brands deploying significant advertising budgets for mainstream media advertising. Deep pocketed general classifieds sites like OLX, funded by the South African mega media group Naspers, and Asani, a Schibsted funded company from Norway, have embarked in our online industry's first media war with ads competing for our eyeballs. Rocket Internet, which runs Daraz and Kaymu in Pakistan, recently completed an $8.2 Billion IPO in October of this year. Daraz and Kaymu are well funded and will be pouring capital into the Pakistani e-commerce market in a magnitude not seen here before. Several other Pakistani online players will be launching their TV ads in the coming months, giving new credibility to the online medium and e-commerce.

All of these developments will lead to a rapid increase in trust as first time online shoppers experience e-commerce and generate acceptance through word-of-mouth.

Pakistani E-Commerce Companies


Big foreign investors are a swooping in to become first movers in key verticals in the world's sixth most populous country with the goal of claiming online thrones. Visionary local players like Home shopping, Shophive and Symbios are organically emerging from our ecosystem and bootstrapping to success. This is a winner-takes-all market: the largest marketplaces grow the fastest making it unviable for new entrants as the industry heats up. And this industry has a voracious appetite for capital. The e-commerce party has started.


The Author is Chairman and CEO of Naseeb Networks and is one of Pakistan's most prolific Internet entrepreneurs. He runs leading online job classifieds sites ROZEE.PK in Pakistan and Mihnati.com in Saudi Arabia. 


This post reflects the author's assessment of the e-commerce scene he sees in Pakistan. The owner of this blog does not necessarily agree with the contents of this guest post. 


Here's a couple of video clip on e-commerce company leaders in Pakistan:

http://www.youtube.com/watch?v=ehNY5GuY8Vw



http://www.dailymotion.com/video/x1aoyc7_daraz-pk-co-founder-farees...



Views: 1940

Comment by Riaz Haq on May 30, 2017 at 4:12pm

SimSim, Pakistan’s first free mobile wallet, gets SBP approval

https://en.dailypakistan.com.pk/technology/simsim-pakistans-first-f...

LAHORE – Pakistan’s first free mobile wallet, SimSim, has received regulatory approval from the State Bank of Pakistan.

The approval was granted, earlier this month, under the Branchless Banking Regulation framework formulated by SBP.

SimSim is collaboration between FINCA Microfinance Bank Limited and FINJA Pvt. Limited. This is the first time a bank and a fintech, acting as the super-agent of the bank, have partnered to create a digital financial product.

“SimSim’s pioneering instant mobile account will go a long way in boosting financial inclusion in the country and digitising the economy,” stated Mudassar Aqil, CEO of FINCA Microfinance Bank Limited.

Discussing future plans for SimSim, Qasif Shahid, CEO of FINJA, said that SimSim is not simply a product or an app, rather it is a movement to free digital commerce in Pakistan.

Monis Rahman, tech veteran and co-founder of FINJA, added that the ease of becoming part of the SimSim network positions it as a platform, which users can spread and grow without any friction.

SimSim successfully completed a beta pilot prior to the formal approval from SBP, and recorded PKR 600 Million in transactions, 30,000 in self-registered mobile wallet accounts and a retail network of 500 participating merchants.

The mobile wallet is a highly innovative, automated process which relies on NADRA integration and machine learning. Anyone with a valid CNIC can create a SimSim branchless bank account, in under one minute, using their internet-enabled mobile phones.

SimSim is connected to other banks through 1-Link for instant transfers, while ATM cards are available for cash withdrawals. Payments through SimSim are free for the receiving and sending users with their mobile numbers acting as bank account numbers.

To be a part of the SimSim network, all anyone has to do is download the app from the Apple App Store or Google Play Store and set up their wallet.

FINCA Microfinance Bank

FINCA, one of the fastest growing microfinance bank with a global presence in 21 countries and a network of 105 branches in 94 cities across Pakistan. It is the pioneer microfinance bank in Pakistan which truly introduced the first complete digital mobile wallet – SIMSIM.

Comment by Riaz Haq on July 10, 2017 at 10:44pm

-based apparel  label Sana Safinaz's -based e-tail solution featured in Magento case study 

For Sana Safinaz, Pakistan’s leading fashion brand, March is the start of the summer season, and the fashion industry’s hectic ‘lawn season.’ ­According to the Hindustan Times: “Lawn is the name Pakistanis use to refer to the brightly colored cotton fabric sold in stitched and unstitched form in a myriad of hues, to an eager set of buyers who will sometimes go to great lengths to get their favourite suit pieces.” During this peak season, shopping malls are overwhelmed with customers. “Compared to normal trading days at our brick and mortar stores, the footfall during collection launches increases 600 percent,” reveals Sana Safinaz’s Haris Ahmed, their Head of Retail Business. You can only imagine the impact of traffic on the brand’s website.

“Our website goes crazy,” says Moeed Ahmed of the Sana Safinaz Digital Business team. “Brand collection launches during the lawn season are met with an abnormal spike in traffic,” adds Tariq Siddiqui, the brand’s Manager of Digital Business. “Across the whole industry it’s rare to find a site that has the infrastructure to successfully handle a surge without affecting customer experience.” Adding to their traffic is the company’s regular investment in highly-optimized Google search/adwords campaigns, that generates almost 35 percent of their total traffic. With the spotlight on Sana Safinaz this summer season, and the eCommerce business becoming a high percentage of the company’s total inventory, their site had to perform. Oh, and they only had a month before launch. Naturally, they chose Magento Commerce.  

Sana Safinaz got to work straight away with their local development partner, Webwork Solution (Pvt.) Ltd. They chose Magento Commerce (formerly Magento Enterprise Cloud Edition), so they would never have to worry about servers and traffic spikes again. They also wanted to beat their competition by capitalizing on the rich core functionalities of Magento Commerce, and its highly effective marketing/segmentation modules. The team broke the project into two phases: Phase one included the “must have” features like order fulfillment and integration with their Point of Sale system. Phase two focused on additional capabilities like social media extensions to generate additional sales through social platforms, along with other site feature deployments.

With Magento, the Sana Safinaz team spent their time improving site structure and user experience, rather than panicking about IT and site crashes. With a cloud solution built on AWS, they knew their new Magento Commerce site could handle the crazy traffic that was about to hit.

The moment of truth arrived on March 3, 2017. Across Pakistan, the lawn season had begun, and millions of Pakistani women were hustling to buy their ultimate summer outfit. The Sana Safinaz site went live, and on the first day it processed more than 5,000 orders. Before Magento Commerce, the most orders ever processed on a single day was 1,000. As page views increased by 87 percent, their customers were raving on social media: “We were able to place orders so smoothly,” wrote one customer, “Never had this with other brands.”

Adoption of eCommerce in Pakistan has been slower than other parts of the world due to infrastructure issues. Customers can also be distrustful of online payments and delivery. Sana Safinaz is helping to change that. The launch was so successful that it increased the share of digital business in the company’s overall revenue, and redefined Sana Safinaz’s eCommerce strategy.

The positive customer response is directly tied to the scalability, flexibility, and stability of Magento Commerce, and for Sana Safinaz, the sky is the limit. Today, the brand is experimenting with Magento Business Intelligence to find out more about their customers. They’re implementing an omnichannel solution to integrate their 30 brick-and-mortar stores, and are expanding internationally. As Sana Safinaz discovered, with Magento Commerce you don’t fear traffic spikes, you celebrate them.

Comment by Riaz Haq on August 16, 2017 at 5:04pm

What happened at Google IO Extended 2017 Karachi

By Samrah Syed 

https://www.techjuice.pk/google-io-extended-2017-karachi/

Google I/O’17 Extended kicked off in Karachi on August 5 at IBA City Campus. Google I/O is an annual developer conference held by Google in San Francisco, California and brings together developers from around the globe to focus on exploring the next generation of tech.

Seeing the need of the tech community integration in Karachi, GDG Kolachi brought the conference to Karachi whilst delivering rich content through tech talks, code labs and live demos to a diverse audience of techies.

I attended Google I/O for the first time and it was an experience that I won’t forget anytime soon. Being a student from NED University of Engineering and Technology on my path to development, as well as being an organizer at GDG Kolachi, this not only opened doors for me to network with some of the Tech Gurus in Pakistan but also caught me up to date with the Google’s latest technologies.

This year Google announced a ton of stuff such as what’s next for Android and other platforms. Here is a sneak peek of the event with my lens.

The event kicked off with a keynote by Khurram Jamali. Jamali, Country Lead at Google, Pakistan. Jamali motivated the audience by his story and gave the summary of the I/O from the Pakistani market perspective. Going on, Eric Bhatti, Manager GDG Kolachi talked about what’s new in Android.

Bhatti’s session was followed by Asadullah Yousuf, from TPS Worldwide, who made an app in less than 19 minutes using flutter, a mobile app SDK designed to help developers and designers build modern mobile apps for iOS and Android. That was something that gained a huge applause.

The talks continued with Jehan Ara telling the Pakistan Start-Up story and Umair Khan from 10Pearls sharing a talk on Database on fire. Sadaffe Abid, Co-founder CIRCLE brought some diversity by conveying the role of Women Techmakers and She Loves Tech. To add to a little more diversity in the topics, Atyab Tahir, Head of Digital Transformation at HBL talked about financial services Nexus.

More speakers were lined up. Mehdi Raza built a really cool app with Google Assistant that essentially requires no coding! Sohaib Khan gave a talk on designing better voice experiences for Google Assistant. Harris Solangi, co-manager at GDG Kolachi, demonstrated how easy it is to develop intelligent applications using the ML APIs that Google offers.

The long day of talks came to an end with the closing by Junaid Iqbal, MD Careem who talked about the Future of Technology in Pakistan.

The diversity of the tech talks was something that no doubt added to the richness of the conference. As one of the attendees said, “It was a great experience. I was introduced to new technology by Google that I didn’t know about before.”

A few important announcements were also made at the event.

The API.AI challenge by Google, so if you have an up to beat idea, start making an assistant app now to participate in the challenge.
GDG Kolachi will also be setting up a local API.AI challenge. So If you are making an assistant app, also share it with GDG Kolachi by emailing at hello@gdgkolachi.com. The best apps will be evaluated and will get a prize at GDG Devfest.
Organizations can support the initiative of GDG Kolachi as well: https://goo.gl/vJDZSp
Google Developers Group are Google sponsored communities of techies and coders who work together to promote learning and development in the tech field, through events like Google I/O.

Comment by Riaz Haq on September 27, 2017 at 9:10am

Alibaba comes to Pakistan
Published in Sep-Oct 2017
By Nabeel A. Qadeer
The pros and cons of Alibaba’s entry into Pakistan.

http://aurora.dawn.com/news/1142379

Pakistan’s IT industry has massive growth potential and even greater investment prospects. In light of this, e-commerce giant Alibaba, one of the world’s largest online retailers, with a total market value of $380 billion, has recently signed an MoU with our Ministry of Commerce. This development is aimed at promoting exports from SMEs and may potentially lead to an investment of approximately $400 million in Pakistan’s e-commerce sector – investment at the moment stands at well north of $120 million. Furthermore, this agreement entails the provision of training for SMEs with respect to using e-commerce platforms, along with promoting mobile financial services and online payment services.

On the face of it, Alibaba’s entry seems full of benefits. However, it would be wise to consider both the potential benefits, as well as the drawbacks which may arise as a result of the company’s entry into Pakistan.

We know that investors often label Pakistan as unsafe for investment purposes and for a long time no major e-commerce company has dared to set foot in Pakistan. However, there has been a drastic change in this perception. Large e-commerce portals, such as PakWheels.com, Zameen.com and Rozee.pk have changed the landscape of the e-commerce industry. This change may be rightly attributed to the emergence of 3G and 4G, which constitute 90% of Pakistan’s broadband base. With the entry of Alibaba, other tech giants will follow, with the result that SME exports will be encouraged, an issue which was previously not addressed.

The promotion of the SME sector will have a trickledown effect that will spearhead the development of local manufacturing. In addition to this, an investment of $400 million will prove to be beneficial to the e-commerce sector. Foreign competition will lead to better standards in this sector and force local e-commerce companies such as Daraz.pk and Homeshopping.pk to become more efficient or risk being wiped out. Consequently, not only more jobs will be generated, but HR and relevant skill-sets will also be developed. Alibaba’s partnerships with local vendors could also boost the economy. Good examples here are Careem and Uber; owing to their success, many local start-ups have done well – many have worked on the same model and brought motorbikes and rickshaws to similar businesses. Thanks to these developments, Pakistan’s GDP grew by 5.3% – a 10-year high, and according to Ishaq Dar, the former Federal Finance Minister, for the first time the size of the economy surpassed $300 billion.

However, there is a negative side to this. As a foreign firm with resources equivalent to that of the world’s 22nd largest economy, the entry of Alibaba poses major threats to the e-commerce industry. Firstly, there is the possibility of the monopolisation of the e-commerce industry, as local players will not have the means to compete with Alibaba’s resources and as a result, some of these ventures may die out. This fear is even more realistic when seen in the light of Alibaba’s track record of acquiring local businesses. Furthermore, the presence of the Alibaba platform could potentially increase the dumping of Chinese goods in the market. As a result, local manufacturers will be unable to match the low prices Chinese manufacturers offer. More importantly, the Alibaba Group has been influencing China’s economic and foreign policies, something which may also happen in Pakistan.

Comment by Riaz Haq on January 13, 2018 at 7:57pm

135 Million Millennials Drive World's Fastest Retail Market

Middle class expected to surpass U.K., Italy over 2016-21
Faseeh Mangi
September 28, 2017, 1:00 PM PDT
From 
  • Nearly two-thirds of Pakistan population under 30 years old
  • Pakistan’s retail stores forecast to grow by 50% in 5 years

Pakistan’s burgeoning youth and their freewheeling attitude toward rising incomes have turned the nation into the world's fastest growing retail market.

The market is predicted to expand 8.2 percent per annum through 2016-2021 as disposable income has doubled since 2010, according to research group Euromonitor International. The size of the middle class is estimated to surpass that of the U.K. and Italy in the forecast period, it said.



Pakistan's improving security environment, economic expansion at near 5 percent and cheap consumer prices are driving shoppers to spend up big. Almost two-thirds of the nation's 207.8 million people are aged under 30, according to the Jinnah Institute, an Islamabad-based think tank.

“We have a new millennial shopper at hand. They don’t mind spending to have the kind of lifestyle they would like,” said Shabori Das, senior research analyst at Euromonitor. “It’s not like the Baby Boomer generation where savings for the future generation was important.”



Pakistan is bucking the trend in the U.S. -- where stores are closing at a record pace as e-commerce undermines bricks-and-mortar. It's also attracting foreign operators: Turkish home appliance maker Arcelik AS and Dutch dairy giant Royal FrieslandCampina NV entered the market last year via acquisitions. Meanwhile, Hyundai Motor Co., Kia Motors Corp. and Renault SA are all building plants in the South Asian nation.

Pakistan’s retail stores are expected to increase by 50 percent to 1 million outlets in the five years through 2021, Euromonitor said. Its three biggest malls, Lucky One in Karachi and Packages Mall and Emporium Mall in Lahore, opened in the past two years.



Pakistan is mirroring what India went through about four years ago. Both countries have young populations with more income and less inclination toward saving which is a distinct difference to what retailers elsewhere are dealing with, said Das.

https://www.bloomberg.com/news/articles/2017-09-28/135-million-mill...

Comment by Riaz Haq on March 15, 2018 at 11:33am

Alipay in Pakistan?

https://www.brecorder.com/2018/03/15/405127/alipay-in-pakistan/

Does Pakistan’s digital payments’ landscape finally have the breakthrough it was looking for? China’s Alipay, which has over 800 million users across multiple markets, is about to enter Pakistan. E-commerce watchers would now wish that Alipay’s founder, the Alibaba – which spun off Alipay from its e-commerce setup some years ago but still owns Alipay’s underlying technology – also follows suit soon.

Ant Financial Services, the group that owns Alipay, has made a deal to buy 45 percent of Telenor Group’s stake in the Telenor Microfinance Bank, formerly Tameer Bank, at a value of $184.5 million. This is confirmed by Telenor Group’s public statement on this subject. After building critical mass of Easypaisa users, Telenor Pakistan will do well to further scale the business with a formidable strategic partner.

Mind you, Ant is the world’s largest Fintech co. It has been focused in the past couple of years on growing its scale overseas. Though its acquisition bid for US money-transfer giant MoneyGram failed earlier this year, Ant has struck local partnerships with digital and financial players in strategic markets like Indonesia, Malaysia, the Philippines, Thailand, Singapore and South Korea.

The Telenor-Ant deal, if it goes through the local regulatory checks, is significant for Pakistan, on multiple counts.

One, the deal would bring the local Fintech market into spotlight. The market potential of some 100 million unbanked individuals is a mouth-watering prospect for Fintech players. Alipay, with its robust technology payment platform, stands a better chance to build scale, which is essential to provide low-cost digital payment services in a low-income market.

Two, it may help the online economy’s ecosystem to grow further. The online economy – which includes e-commerce as well as the gig economy – needs acceptance of digital payment solutions at the grassroots level to be able to realize its billion-dollar potential in the near term. While the cash-on-delivery payment settlement is good to build user trust early on, in the long run, digital wallets will be more efficient.

Three, Alipay’s entry in the market might force the big banks as well as branchless banking (BB) providers to wake up and smell the coffee. Local banks seem content raising CASA deposits from a small user base – now they risk losing a big chunk of the potential market to digital. As for the BB operators, they are still stuck at a collective 15-16 million active accounts, drastically lower than the potential. It is time to make serious investments in Fintech and improve the service offering

And four, Alipay’s experience in Pakistan may provide impetus to some major e-commerce FDI coming into Pakistan later. While Alipay could help revolutionize the financial side of e-commerce here, local players like Daraz, TCS and others are slowly becoming efficient at merchandising and marketing. Should Alipay find traction in Pakistan, it may convince Alibaba to make its move and find a local partner, or target.

Comment by Riaz Haq on March 19, 2018 at 10:36pm

#Alibaba Mulls Buying #Daraz, Rocket Internet's #Pakistan #ecommerce Unit after buying stake in #Telenor finance unit - #Alipay #payments Bloomberg

https://www.bloomberg.com/news/articles/2018-03-20/alibaba-is-said-...

Group entered Pakistan last week with microfinance bank stake
Nation’s e-commerce, retail stores growing: Euromonitor
Alibaba Group Holding Ltd. is considering acquiring Rocket Internet’s online retail unit in Pakistan to help China’s biggest e-commerce company expand its reach in the South Asian, a person with knowledge of the matter said.

The companies are negotiating a price for Rocket’s retail unit Daraz, according to the person, who asked not to be identified since the discussions are private. The deliberations are an early state and no decisions have been made, the person said. Alibaba’s spokesman declined to comment, while Daraz didn’t immediately respond to requests for comment.

The development comes after Alibaba’s Ant Financial decided to purchase a 45 percent stake in Telenor Microfinance Bank, a subsidiary of Telenor Group, for $184.5 million last week to further develop mobile payment and digital financial services in the nation of more than 200 million people. Elsewhere in Asia, Alibaba is gearing up for an intense battle in Singapore, where Amazon.com Inc. has started operations and Sea Ltd.’s Shopee is expanding to win consumers.

Pakistan’s burgeoning youth has turned the nation into the world’s fastest growing retail market with stores and e-commerce both growing together, bucking the trend in many developing nations. Pakistan’s market may expand 8.2 percent a year through 2016-2021 as disposable income rises, according to research group Euromonitor International.

Pakistan has 30 million active Internet users, and brands are redoubling their attention to e-commerce, Daraz said in a statement last month. Alibaba’s interest in Pakistan comes on the back of Beijing’s financing of about $60 billion in infrastructure projects across the country as part of President Xi Jinping’s Belt and Road trade initiative.

--------------------------


http://www.euromonitor.com/non-store-retailing-in-pakistan/report


TRENDS
The accessibility of the internet to the growing number of young and urban consumers resulted in an internet retailing boom. The rapid growth in mobile internet usage and increased awareness of internet retailing encouraged multiple internet retailers to enter, which resulted in a sizeable increase in e-commerce.

COMPETITIVE LANDSCAPE
Jade-E-Services Pakistan Pvt Ltd (Daraz.pk) led non-store retailing channel with 13% of value sales in 2016. The first ever online Black Friday Sale SAS by daraz.pk in November 2015 was a major success with record-breaking sales. Daraz.pk also established successful partnerships with some renowned international brands and earned exclusive distribution rights. All this, along with impactful marketing campaigns, huge product assortments and good customer service resulted in massive growth for daraz.pk.

PROSPECTS
A fast-growing young population and a rise in the number of middle class consumers coupled with high penetration of low-cost smartphones from China and rapid growth in broadband and mobile internet use will be the main driving forces of non-store retailing in the long term. The increasing confidence of consumers in online shopping will continue the rapid transformation of consumer buying habits which, along with easy access to the internet, will continue to grow non-store retailing in Pakistan.

Comment by Riaz Haq on March 26, 2018 at 9:45pm

Alibaba moves to attract Pakistani exporters towards B2B portal

https://www.thenews.com.pk/print/296986-alibaba-moves-to-attract-pa...

Chinese ecommerce giant Alibaba Group geared up efforts to get Pakistan’s exporters listed on its multination business-to-business electronic portal, the company’s senior executive said on Monday, after the firm expressed its intention to acquire a Norwegian telco’s financial subsidiary in the country.

Alibaba.com's Country Manager Jason Jia said the group has launched Pakistan pavilion on the website to showcase indigenous product listings following the Trade Development Authority of Pakistan and Alibaba Group signed a pact to improve the country’s ecommerce and boost exporters’ business last year.

“We want to work together to introduce Pakistani products to the world markets,” Jia said, addressing a roadshow for Karachi-based businessmen who constitute a negligible portion of the platform’s registered suppliers.

Currently, there are 3,000 paid members and most of them are based in Sialkot, Lahore and Faisalabad, while textile, leather, surgical instruments and sports goods sectors are the top categories. Even before the launch of Pakistan’s page, Alibaba has been attracting local buyers and suppliers. Overall, it has around 250,000 registered members from Pakistan. The site charges up to $1,500 annually from featured suppliers. Alibaba also signed up five local partners, including NJ Dynamic Solutions, EB Excels, NextBridge, Alpharex International and Trademor to provide sales and service support to member companies.

“We are looking for more from Karachi, especially apparel and garments sector,” Jia said, referring to more than three million small and medium businesses in the country.

Multilingual Alibaba.com is the world’s leading business-to-business portal operating in 190 countries. It has two million online shops and 260 million plus buyers from across the world.

Mohammad Zia, a rock salt trader posed trust on the site’s capacity to generate orders for his start-up. “I have generated a good number of orders,” Zia said, declining to share the numbers, but added that his company grew to 10-worker payrolls from four in the past two years.

Zia said payment from foreign buyers gives him jittery and “so, if Alipay comes in there will be a much relief”. “Currently, we receive payment from banking channels, and Alibaba’s involvement in payment too will make all the things integrated,” he added.

Ant Financial Services Group, an affiliate of Chinese e-commerce giant Alibaba, agreed to acquire 45 percent stake worth around Rs20 billion in a subsidiary of Norwegian Telenor to broaden access to financial services through digital payment solutions in Pakistan. Completion of the transaction is subject to customary regulatory approvals. Ant’s technology Alipay, the world’s largest digital payment platform, would bring mobile payment and inclusive financial services to individuals as well as small and micro businesses in Pakistan where 90 percent of online orders of around Rs10 billion are fulfilled using cash-on-delivery.

Comment by Riaz Haq on May 22, 2018 at 7:45am


#Alibaba's entry in #Pakistan hailed as boost for #DigitalEconomy. Experts predict #Islamabad likely to lower high taxes after #Chinese e-retailer's investment. #ecommerce #fintech #Daraz #AliPay #Telenor #Telecom #payments

https://asia.nikkei.com/Business/Companies/Alibaba-s-entry-in-Pakis...

KARACHI -- Alibaba Group Holding's recent purchase of a Pakistan-based online retailer has positioned the Chinese technology conglomerate to make inroads in e-commerce across South Asia, but the acquisition has raised expectations of robust growth in an industry that many experts say performs well below its potential.

Gaps such as the absence of a global online payments system can now be filled through Alibaba's Alipay service, said Shuja Rizvi, a Karachi based senior stock market analyst at Al-Hoqani Securities. "With the entry of a major player like Alibaba, Pakistan's policies will be molded to face global competition and our environment will hopefully improve," Rizvi said in an interview with the Nikkei Asian Review, citing one of the most commonly discussed benefits of Alibaba's arrival in the country.

Alibaba announced earlier this month a deal to buy Daraz Group, a Pakistani digital marketplace company, for an undisclosed amount. Since it was founded in 2012, Daraz has steadily expanded its services to Myanmar, Bangladesh, Sri Lanka and Nepal, say analysts who regularly track the e-commerce sector.

The acquisition comes as Pakistan prepares to receive more than $60 billion in Chinese investment under the China-Pakistan Economic Corridor -- a cornerstone of Chinese President Xi Jinping's Belt and Road Initiative. Alibaba's arrival in Pakistan also has been preceded by significant growth in cellular phone services and high-speed internet across the country in recent years, analysts say.

According to the Pakistan Telecommunication Authority, or PTA, the official regulator of the telecom sector, more than 73% of Pakistan's population, or roughly 149 million people, have cellular phone subscriptions. Especially important for the growth of digital businesses is the estimate of 56 million people, or more than 27% of the population, who subscribe to broadband services -- a key figure indicating the number of internet users, many of whom will be potential future online customers.

"Today, the number of internet users in Pakistan are more than the entire population of many countries around the world," a senior official with the Ministry of Information Technology and Telecommunication in Islamabad who requested anonymity because he was not allowed to speak to journalists, told Nikkei. "For investors like Alibaba, there is fertile ground for a strong future expansion."

Other PTA officials said that online retail businesses in Pakistan have much room to grow as they have an advantage over traditional retail outlets that have to invest heavily in commercial real estate to sell their products to consumers.

"In the most prized commercial markets of Pakistan -- in big cities like Karachi, Lahore or Islamabad -- rents have more than doubled for the top-end premises just in the last 10 years," said the Ministry of Information Technology official. "And the overhead costs -- especially rents -- continue to rise."

Barkan Saeed, chairman of the Pakistan Software Houses Association, the main representative body of the country's software industry, welcomed Alibaba's purchase of Daraz and entry into the country "as a major milestone" for Pakistan's e-commerce sector. Saeed said that while the government estimates the annual value of e-commerce transactions in Pakistan at approximately $600million, the actual figure could be five times that amount.



Comment by Sana Khan on November 7, 2018 at 2:46am

 Very informative and useful blog 

pakistan biggest website

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