Online Business in Pakistan

Syed Afraz and Hiba Ibrahim

 Electronic Commerce

 Electronic commerce, or ecommerce, is the business done

through the internet.
 It is the activity of buying or selling of goods over the
internet.
 Online businesses are becoming very common and
convenient around the world.
 Pakistan has also entered the online business market and
has developed ecommerce websites.
 This has worked in the favor of many businesses in
Pakistan, but some businesses are still facing a lot of
challenges such as literacy issues, lack of trust, costs and
delivery, payment issues and the nature of the Pakistani
public.
 Literacy Issues

 The literacy rate of Pakistan is 54% out of which 50% are computer
illiterate, and there are 75% of illiterate people who have no
knowledge of the internet, therefore, they do not have access to the
ecommerce websites.
 These are used by a very small number of people since majority of
the population does not own a computer due to rising computer costs.
 There is an even smaller population that is engaged in online
shopping.
 If the costs of computer hardware go down, more people can buy the
computers and have access to the internet which will improve the
online business market.
 Cheap and reliable internet connections with high speed will also
prove to be in favor of the usage of the ecommerce websites.
 Lack of Trust
 People have trust issues in buying products which they cannot
see or touch.
 They only buy a product online if they are already familiar with
the brand or if they have heard positive reviews. It is very rare
that they buy new products online without prior information.
 In other countries, online shopping is preferred over physical
shopping because it is considered as a time saving option, but
people in Pakistan prefer to go to malls or outlets rather than
shopping online.
 They don’t trust these websites with respect to their private
information like credit cards, phone numbers, addresses etc.
 Online businesses should have support and guarantee by the
government or other trustworthy companies so that these fears
are reduced.
 Costs and Delivery
 The main purpose of an online business is to reduce the
operating costs while also satisfying customer needs.
 Businesses are lowering their costs in any way they can by
maintaining their inventory stock and delivering requests
but they fail to maintain credibility.
 This is because their transport system for delivery of goods
is very much unreliable since they employ local transport
companies.
 They do not guarantee a time based delivery to customers
and with fewer sales, more costs are incurred.
 Reliable, cheap and quick transportation channel should be
established by these businesses to distribute products faster
and effectively.
 Payment Issues

 People have major trust issues when confiding in online

businesses.
 Most businesses ask for online payment rather then cash on
delivery (COD) that is a barrier to growth.
 Very few people in Pakistan own a credit card, since most
people use cash for their day to day transactions and without a
credit card, they cannot purchase online which is a loss of sale
for the business.
 People who do own credit cards have a hard time in trusting
websites with their personal information unless it is a
renowned brand and one that they trust.
 Businesses should keep an open option for online payment as
well as COD.
 Nature of the Public
 The nature of the Pakistani society is very traditionalistic.
 They do not buy products that they cannot feel or touch, and
they do not believe in the online payment system since
Pakistanis resist to change.
 Pakistan has a relationship-oriented society where people
mostly form relationships with family businesses and maintain
their long term associations rather than trying out new brands.
 People are also accustomed to the practices of product return
and exchange which is a service that online businesses do not
provide.
 This makes people uncomfortable and insecure in buying
goods online.
 Online businesses should have a return and exchange policy in
order to grow the market.
 Pakistan’s Ecommerce Players (types)
 Multi retailer platform: These are the dominant forces in the ecommerce
industry having a wide collection of products listed on their websites.
Examples of these platforms are Daraz, Symbios, Food panda, Bookme.pk,
Yayvo, Goto, Well.pk etc.
 Niche retailers: They focus on one niche and try to leverage their specialty to
drive sales. Examples are online stores like Higher.com.pk and
Babynestboutique.com etc.
 Companies having their own online stores through which orders can be
placed. Retailers like Gul Ahmed and Khaadi are good examples of this
category.
 Facebook/social media retailers have very well established Facebook stores or
groups. Examples are Facebook business pages (shops) like Karachi Buy &
Sell. Usually housewives and traders who want another avenue of sales make
up the bulk of this segment.
 Opportunities, Benefits and Ideas of Ecommerce in
Pakistan
 COVID-19 & E-COMMERCE:
Chinese digital company Timesaco has launched an e-commerce platform
‘Dazaran’ to provide a facility to the people in the current challenging situation
of the Covid-19 pandemic.
 BECOME AN INTERNATIONAL E-COMMERCE CHAMPION TO
INCREASE EXPORTS:
Online shops across country borders, are the most important area to be worked
on by developing countries like Pakistan.
 ISSUANCE OF DIGITAL CURRENCY BY SBP:
The SBP has announced issuance of digital currency by 2025. So this will also
encourage the investors and businessmen to contribute easily across the
borders of Pakistan.
 E-COMMERCE AND TOURISM:
E-commerce offers Pakistan the opportunity to participate in value chains for
global tourism and have fair access to international tourism markets on the
Internet.
 Benefits from ecommerce
 E-COMMERCE FOR JOB CREATION:
Increased use of digital financial service, 4 million jobs can be
created by 2025 by Pakistan and it can increase its GDP by $36
billion.
 E-COMMERCE AS A RESOURCE TO HELP REDUCE
POVERTY:
 Developing financial services for rural areas through Ant
Financial (Alibaba subsidiary)
 Establish a network of E-commerce services in counties and
villages
 Improve logistical links for villages by shipping "two-stage
delivery" packages from county to village centers
 Provide e-commerce training for employees
 Promote entrepreneurship
 Major Ideas to start Online Business in
Pakistan
 Meal sharing company
 Blogging
 YouTube channel partner
 Sell creative products online
 Online tutoring
 Consulting services
And etc…….
THANKYOU