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Cambodia’s e-commerce platforms need to integrate with digital logistics infrastructure

E-commerce platforms launched to help promote Cambodian-made products, to both local and international markets, need to work better with local digital logistics infrastructure, according to sector experts.

Speaking at the Sustainable Agri-Food Partnership Model in Cambodia and Indonesia, logistics specialist and IndoCham President Pak Dalton Wong said e-commerce platforms must always consider the e-logistics and e-payment solutions required.

E-logistics is automating the logistics processes and providing integrated end-to-end fulfillment and supply chain management services.

“Cambodia is still in the process of developing its logistics sector especially for the country’s rural areas and last-mile delivery service,” Dalton said.

Dalton is Chairman of Speedwind Group, a leading distribution and management services company with the largest network in Cambodia.

“In addition to e-logistics the online stores also need to ensure their digital payment services are properly integrated into the overall ecosystem,” Dalton added.

The most recent online e-commerce store launched is Cambodia Trade is an online marketplace for Cambodian small and medium enterprises (SMEs). The Ministry of Commerce signed with Wing Bank to enable its digital payment system.

The Cambodian government has been attempting to better connect farmers with end-to-end supply e-logistics which is very dependent on banking solutions.

Ken Swari Maharani from PISAgro the multi-stakeholder platform focusing on sustainability for Indonesia’s agriculture sector said in Indonesia companies are working on combining blockchain technology in the agri-sector.

“These companies are mostly focusing on traceability and also payment gateways,” the strategic manager said.

“In terms of an online platform like e-commerce, actually in Indonesia the trend, especially during the pandemic is people are using more online platforms to buy agrifood products (vegetables and fruits, especially),” she added.

One local producer Soeng Sopha who has listed her company, Sela Pepper, on the Cambodia Trade platform was speaking at the event and said her company was yet to see any sales.

“Hopefully by the end of 2022, there could be an increase in digital marketing in addition to better logistics options,” she said. 

“That said we have only just launched our product on the site and it is still too early to fully gauge its success,” she added.

Sector experts have warned about reliable parcel delivery – particularly inclusive of tracking functionality – will be key to fostering consumer trust and growth.

The Cambodian government has earmarked promoting Cambodian-made products as a key initiative to assist the country to develop.

Nationalism in Cambodian-made products has also been identified as key factors to help address the low level currently available and sold in the Kingdom, according to both public and private sectors.

The government has previously highlighted the need to assist small and medium enterprises to invest in resolving these concerns as estimates are only 20 – 30% of registered products in Cambodia are locally made.

According to data analyst site Statista, revenue from the eCommerce market in Cambodia is projected to reach $251 million by the end of 2021, with an annual growth rate of 8.94% between 2021-2025.

The number of users of Cambodia’s e-commerce market is expected to reach approximately 7.8 million by 2025 and representing a user penetration of 44.1%, the site added.

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