Friday, October 23, 2015

Why eCommerce will Dominate the Retail Space in Sri Lanka in the next 5 years.



Walmart announced last week that it will significantly increase its investment in their eCommerce operations. They have realized (a little late) what they should have realized a long time ago; that eCommerce will be a game changer in the retail landscape and now they are trying to play catch up. This will end up costing them US $ billions more than if they had either invested or bought over an eCom player sometime back in order to address the balance of power in the retail sphere.


It was not long ago in 1999 when Amazon’s top line was a paltry US $ 1.6 billion compared to Walmarts US $ 138 billion (NY times Report). Around the same time an Amazon market cap was at US $ 20 billion to Walmarts US $ 260 billion (Wiki Inest). I am fairly sure that Walmart saw Amazon as little more than a nuisance, even perhaps a house of cards that was bound to fail. They probably waited for that outcome, but it never came.




Over the last 15 years Amazon has been gaining more and more of the total retail market and now dominates the online market place. This is reflected, now more than ever, in the stock price of each company with Amazon’s stock market value surpassing Walmart’s for the first time in July and now exceeding Walmart’s by more than US $70 billion. Amazon’s stock is up more than 80 % this year. Walmart’s has declined 30 % (NY times Report), and for those who want to invest and make money the better bet has been Amazon for some time now

What does this mean for Sri Lanka? It essentially is a clear sign of things to come in the total retail space in the island. What happened in the US took 15 years, in Sri Lanka this will happen in 5 and here is why.

Smart phone penetration this year is growing at a staggering 30%, with mobile data and access becoming more and more common. What this means is that more people will have easy, cheap access to the Internet than ever before. Mark Mahaney, who covers Internet retailing for RBC Capital stated that in the US market the factors that aid in selling are price, convenience and choice (NY times Report), which are factors that come as a natural advantage for an eCommerce company compared to traditional retail. In Emerging markets I would add ‘Trust’ to be another factor that determines purchase patterns for consumers, which is quickly being established by some of the more entrenched players in the Lankan market among the consumer base. eCommerce will have price, convenience and a choice advantage compared to their brick and mortar competitors.

Some may argue that in mature markets eCommerce has become the norm in retail, whereas in emerging markets such as Sri Lanka eCom continues to be a distant alternative. This may be true today, but times are changing; the eCom players who will weather the current storm in terms of ‘time’ will prosper in the coming years beyond all expectations.

However, this will not take place in a vacuum; to get the ball rolling and for the eCommerce industry to flourish in Sri Lanka it will need a favorable policy to continue to attract investment from here and abroad, and policies that aid in the process of online transactions taking place. I believe from the discussions that I have had with frontier market Venture funds that in time to come eCom will be one of the top attractions for FDI in Sri Lanka.

Further to this the current nascent industry will also be greatly strengthened by the backing of entrepreneurial and industry heavy weights.

What is inevitable however is the rise of eCommerce as both a viable and strong player in the retail fabric of Sri Lanka for the foreseeable future.

All views expressed in this article are the personal views of the author, Lahiru Pathmalal, who is CEO/Co Founder of takas.lk


NY Times Report

http://www.nytimes.com/2015/10/23/business/walmart-plays-catch-up-with-amazon.html?_r=1

40 comments:

  1. Hey, very nice site. I came across this on Google, and I am stoked that I did. I will definitely be coming back here more often. Wish I could add to the conversation and bring a bit more to the table, but am just taking in as much info as I can at the moment. Thanks for sharing.
    Portable Wheelchairs

    Keep Posting:)

    ReplyDelete
    Replies
    1. thanks very much for the comment! great to connect

      Delete
  2. Thanks for sharing the information which is good for me and others also - juesgosio

    ReplyDelete
  3. Wow really interesting article, may later be able to share other helpful information are more interesting. Thank you.
    Slope Unblocked
    Miniclip Unblocked
    Abcya 2
    Friv 11

    ReplyDelete
  4. Really impressive post. I liked your article and I hope you will have many entries or more. I enjoyed your article and planning to rewrite it on my own blog.
    You can play games online my website
    Friv Unblocked
    Y8 Unblocked
    Kizi Unblocked

    ReplyDelete
  5. Next-generation eCommerce sites will do more to transform the online shopping experience into online buying by presenting the product in user-controlled 360° views.Creatine Mono

    ReplyDelete
  6. Couldn't agree more. There are new ecommerce sites been born everyday and I think one day, this will replace how we buy things. Take a look at these guys for an example iPhones in Kandy

    ReplyDelete
  7. Thanks for the nice blog. It was very useful for me. I m happy I found this blog. Thank you for sharing with us, gift to Pakistan

    ReplyDelete
  8. A meaningful post this is. eCommerce is huge so is directories. Vehicles for sale

    ReplyDelete
  9. Thanks for sharing, nice post! Post really provice useful information!

    Giaonhan247 chuyên dịch vụ mua vòng tay pandora, giải đáp mua hàng trên amazon có đảm bảo không, hướng dẫn cách mua hàng trên amazon, dịch vụ nước hoa pháp chính hãng và giải đáp gửi hàng từ mỹ về việt nam mất bao lâu giá bao nhiêu.

    ReplyDelete
  10. The mobile commerce apps enable users to choose from many payment modes - debit/credit card, internet banking and mobile wallets. What is dropshipping

    ReplyDelete
  11. These blogs are valuable because these are providing such informative information for all the people. how much is print profits

    ReplyDelete
  12. Gracias por compartir su pasión por el mejoramiento de Jogos Friv 2019 Juegos De Five Nights at Freddy's Friv4school 2019 las vidas de los niños en el Estado de Friv Jeux De Fille 2019 Friv 1000 Friv 4 Gracias por vuestras reacciones a Friv 2019 Kizi 2019 Juegos Kizi 2018 las transmisiones que os han hecho.

    ReplyDelete
  13. คาสิโนออนไลน์ที่น่าเชื่อถือและมีความเป็นมืออาชีพที่สุดในตอนนี้
    โปรโมชั่นGclub ของทางทีมงานตอนนี้แจกฟรีโบนัส 50%
    เพียงแค่คุณสมัคร สล็อตออนไลน์ กับทางทีมงานของเราเพียงเท่านั้น
    ร่วมมาเป็นส่วนหนึ่งกับเว็บไซต์คาสิโนออนไลน์ของเราได้เลยค่ะ
    สมัครสล็อตออนไลน์ >>> Goldenslot
    สนใจร่วมสนุกกับ คาสิโนออนไลน์ คลิ๊กได้เลย
    มีทั้งคาสิโนออนไลน์ หวยออนไลน์ ฟุตบอลออนไลน์ สล็อตออนไลน์ และอื่นๆอีกมากมาย

    ReplyDelete
  14. Excellent Blog.Thank for sharing this amazing info.If you want to download videos from YouTube then i recommend you to download tubemate 2019 app here you can easily download any videos you were like.
    https://tubematedownloader.info/youtube-video-downloader/

    ReplyDelete
  15. Hey there! I’ve been following your website for some time now and finally got the courage to go ahead and give you a shout out from Movies123

    ReplyDelete
  16. Another great topic to notice, loved it, thank for created such a great topic Jav

    ReplyDelete
  17. WOW!! Can’t believe this, is this true? LOL. Is there any one have news about this topic? I would love to have some Jav Hot

    ReplyDelete
  18. Your opinion are very interesting, attractive article, so i shared it on my facebook. Promise that a lot of people will enjoy it.
    Jav Censored

    ReplyDelete
  19. This is an excellent blog. First time come here but i was impressive by theme and contain of this blog. Hope your blog will grow more and more in future.
    Japanese Porn

    ReplyDelete
  20. Really preciate you for your information you provide. I have tried a lot but couldn’t find it.Thank you.Jav Hot

    ReplyDelete
  21. That’s true, i have same opinion with you about this. We should together figure this out Jav Censored

    ReplyDelete
  22. Thank you and thank for your shared, i will introduce to my friend to visit your website more often Jav Free

    ReplyDelete
  23. vumoo.  TEL:0460-85-7737

    ReplyDelete
  24. Thank you for the sensible critique. Me & my neighbor were just preparing to do a little research on this. We got a grab a book from our local library but I think I learned more clear from this post. I am very glad to see such wonderful info being shared freely out there.gogoanime

    ReplyDelete
  25. Even on social networking platforms like whatsapp plus , whatsapp gb atualizado em português they have built their brand

    ReplyDelete
  26. Thankyou for giving me useful information.
    Please keep posting.
    토토사이트
    경마사이트

    ReplyDelete
  27. Yes i am totally agreed with this article and i just want to say that this article is very nice and vey informative. More blogs please.
    바카라사이트
    메이저사이트

    ReplyDelete
  28. No Deposit Casinos Coupon Codes 2021 - Riders Casino
    The following are 카지노 가입 쿠폰 all the latest no deposit casino promo betway codes, deals and coupons to enjoy from 다파벳 this December:. No deposit bonus codes.

    ReplyDelete
  29. you are using fm whatsapp for texting but don't know how to update then fm whatsapp fmwaapps is a safe update place for you to use the app better

    ReplyDelete
  30. K-Electric or Karachi electric is responsible for supplying electricity for almost thirty consumer centers that include Bahadarabad, Gulshan, Johar 1, Landhi, Johar 2, Baldia, Bin Qasim, Liyari 1, Liyari 2, Liaqatabad, Nazimabad, Kimz, Korangi, Clifton, Defence, FB area, Garden, GADAP, Malir, North Nazimabad, North Karachi, New Karachi, Orangi 1, Orangi 2, Shah Faisal, SITE, Uthal, Tipu sultan, Surjani, Saddar.

    K-Electrcic Bill Payment Consumers can now pay their K-electric Bills Online. Here is provided the complete list of banks that provide Internet Banking and Mobile Banking for K-Electric bill payment online.

    ReplyDelete