WITH the growing popularity of online shopping globally, Filipino retailers are being encouraged to tap the expanding Chinese consumer market through e-commerce.

In a letter sent to government officials, Foreign Affairs Undersecretary for International Economic Relations Laura del Rosario said the Philippine Embassy in Beijing has recommended that local entrepreneurs exploit such opportunities amid increasing cross-border e-commerce transactions.

“The Chinese government has been encouraging the further development of cross-border e-commerce to boost exports and generate more employment,” del Rosario said in a Philippine Exporters Confederation report.

Statistics of the Chinese Ministry of Commerce indicated that cross-border e-commerce transactions exceeded $505.3 billion in 2013, accounting for 12.1 percent of total global trade compared to 4.6 percent five years ago.

According to del Rosario’s letter, China has been promoting a shift towards consumption and services to drive their economic growth from previous emphasis on manufacturing and capital investments.

The Boston Consulting Group has projected that China’s new generation of shoppers “prefer online shopping over brick and mortal stores.” The consultancy firm also forecast China will overtake the United States (US) as the world’s biggest e-commerce market this year.

This retail development was reinforced by Philippine Retailers Association-Cebu Chapter president Robert Go, saying e-commerce is the future of retailing.

He explained that the success of e-commerce in China is because of its expanding middle class, improved local logistics and competitive rates.

“Young professionals in China have caught up with online buying because of new wealth. Middle class has gone up and has money,” said Go, in an interview yesterday.

Although it has gotten the attention of the global market, e-commerce in China still has a lot to improve since it’s mostly in Mandarin and local-centric, said Go.

According to Go, there is high chance for the Philippine retailers to tap this market, if barriers like the language used, credit cards and international logistics as well as import taxes in China will be addressed. 

“It might be the future because of the market size, but barriers have to be broken. Our own e-commerce should also be maximized and retailers should be experts on e-commerce themselves. Going to China might be an opportunity, but we have to enhance productivity. Lower our cost. Lower our price,” Go said.

In Cebu, e-commerce is already gaining popularity among younger retailers. Go said there are success stories but the number of retailers maximizing e-commerce is not that substantial compared to brick and mortar stores.

PRA-Cebu, he added, has been advocating for e-commerce, especially with the advent of online selling platforms and social networking sites.

“There are small individuals doing e-commerce on their own. PRA always encourages entrepreneurs and start-ups so that these kittens becomes tigers in the future,” said Go.