This week, Singapore-based telecom Singtel and Southeast Asia-focused ecommerce platform Lazada announced a partnership to create an online marketplace geared toward serving the needs of small and medium-sized businesses (SMBs) in the country. The new marketplace, named 99% SME e-marketplace (a reference to the fact that SMBs make up 99% of registered companies in the city-state), will be hosted on Lazada’s Singapore-specific site, www.lazada.sg.
Under the partnership, SMBs that decide to use the new marketplace will avail themselves of Lazada’s digital payment services, logistics and marketing prowess. In exchange, Lazada will take a cut of sales transactions.
eMarketer estimates that retail ecommerce sales in Singapore, excluding travel, will total $2.43 billion this year, accounting for less than 5% of total retail sales in the country.
News of the partnership came soon after the Committee on the Future Economy, a government-convened panel of experts from a variety of industries, published a report of recommendations in February 2017 on how to keep Singapore’s economy competitive. The report suggested SMBs be given more government support so that they can adopt digital technologies as well as partner with larger entities that can provide the technological expertise needed to grow their businesses.
Lazada is a natural candidate for facilitating such partnerships bridging the gap between SMBs and new technologies. The platform is Singapore’s most popular ecommerce website, recording 4.7 million visits in December 2016, according to SimilarWeb data cited by ecommerceIQ. The next most popular ecommerce site was Zalora Singapore, which garnered 1.3 million visits during the same month. According to a survey conducted by multinational bank United Overseas Bank (UOB), cited by The Straits Times newspaper in February 2017, many SMBs in Singapore still struggle to adopt digital technologies. In fact, 41% of SMBs were unable to devote resources to adopting technology, while 29% felt that implementing new technology was too complicated for them.