Chainstore Association of Pakistan (CAP) and Pakistan Software Houses Association ([email protected]) have been closely collaborating to ensure timely execution of the action items deliberated as part of the National E-commerce Policy with the Ministry of Commerce (MoC) for over a year.
Pakistan’s retail trade for 2019-20 was estimated to be Rs. 7 trillion (16% of GDP) as per the Pakistan Bureau of Statistics. Presently, the ‘organized retail sector’ comprises approximately 8-10% of the entire trade and has been growing over 20% annually for the last decade.
With 82% teledensity and 95 million internet users in the country (double the population of Spain) as per the Pakistan Telecommunication Authority (PTA), it is believed that traditional commerce and retail will significantly shift towards e-commerce and modern retail. As per the recent State Bank of Pakistan (SBP) data, the total value of domestic e-commerce transactions in the country has risen to over Rs. 350 billion (estimating 90% COD) in the last four quarters up to Q1’2021 with 35% growth over the previous period.
Therefore, e-commerce as a proportion of total retail in Pakistan is estimated to be at 0.55% compared to the global average of 15%.
It is also imperative that the conventional back-end operations and processes in the manufacturing, warehousing and distribution value chain of the retail sector must be modernized with cutting-edge technology and software.
To pave the way for future wider and deeper collaborations, CAP and [email protected] have signed a broader MoU to build on the aim to help retail businesses and SMEs to explore ‘indigenously developed technologies’ for their retail and e-commerce operations. CAP and [email protected] will work closely for mutual benefits of both ‘Organized Retail’ and ‘Information Technology (IT) & Information Technology Enabled-Services (ITeS)’ industries in Pakistan
Both trade bodies will jointly organize and host virtual and physical seminars, awareness sessions, training workshops and business match-making activities in the area of retail, e-commerce and other technical needs of the organized retail sector. A ‘Joint Working Group’ (JWG) comprising senior members of both associations will also be established for industry research, knowledge sharing and mutual cooperation.
Speaking on the occasion Chairman CAP, Tariq Mehboob said,
In the evolving environment, organized retail businesses cannot exist in the absence of modern IT & ITeS solutions and definitely cannot grow without them. The retailers that utilize the best products and services suited for the local environment are the ones that scale and flourish. Similarly, for the development of the IT & ITeS sector, hands-on experience and regular customer input are essential. In particular, CAP will facilitate match-making and meaningful feedback from the retail sector which will enable IT businesses to improve their offerings further and be more competitive nationally and internationally. We are excited about strengthening our collaboration with [email protected] to benefit all businesses in the ecosystem and enhancing economic activity driven by such multi-sectoral partnerships.”
Chairman [email protected], Barkan Saeed highlighted the importance of deeper cooperation between the two trade associations by saying,
First of all, [email protected] would like to appreciate the role of the Ministry of Commerce in not only leading the e-commerce policy narrative in a very balanced way between both public and private sector stakeholders but also making sure that the action items are executed in a letter and spirit. [email protected] strongly believes that both domestic and cross-border e-commerce has huge potential to expand economic opportunities, drive social inclusion, increase SME’s access to global markets, reduce gender bias and help youth leapfrog traditional businesses. This collaboration between CAP and [email protected] will encourage [email protected] member companies to localize their software and technology products and services for CAP members in all aspects of their businesses from production to sales. [email protected] hopes that this partnership will set a new bar for tech and non-tech sectors and industries to work together and explore potential opportunities and synergies.”
A previous MoU executed between both associations in September 2020 focusing on the e-commerce policy implementation was well received by the relevant industry stakeholders and the political leadership alike.
It is believed that this extended MoU will further help the retail sector in the post-COVID era to leverage indigenously developed local technologies and solutions to significantly improve in-store and online sales, reduce operating costs and optimize production, warehousing and distribution operations