: A week ago, Prime Minister Datuk Seri Najib Tun Razak and e-commerce mogul Jack Ma were in Sepang, launching the start of operations for the long-awaited Digital Free Trade Zone (DFTZ).
In typical Alibaba fashion, the event was loaded with pomp, glamour and gimmicks – ranging from the old-fashioned shovel-in-the-ground groundbreaking to a ‘live’ auction where real-time bids were displayed on a huge screen on stage, to the end of that auction with a strike of a gong.
Such grandeur is perhaps fitting for the hype that the DFTZ has brought since it was first announced in March 2017.
DFTZ said it will increase Malaysian SMEs’ export of goods to USD38 billion and create over 60,000 by 2025.
“Malaysia is set to make it easier for SMEs to do cross-border trade. This is the primary purpose of DFTZ.
“It is simplifying e-commerce by bringing together government agencies, eMarketplaces, logistic and payment providers all on one platform,” said Najib at the launch.
On top of enabling Malaysian SMEs to promote and market their products on Alibaba’s huge platforms, the DFTZ will also improve and streamline logistics, delivery, payment and customs clearance processes for the said products.
Their ultimate goal? To deliver any products from any Malaysian SMEs to a buyer within three days of ordering.
A total of 1,972 local SMEs have been selected as the first batch to participate.
But, nevertheless, a large portion of our SMEs still can’t really see the actual, tangible benefits they will enjoy from the DFTZ since their exposure would have been limited to press releases and media reports.
As with e-commerce and buying things online, most people need to see, hear or perhaps touch it, to truly understand and believe in it.
Maybe our SMEs need to see real-life examples of what the DFTZ can offer them and how it can elevate their businesses to epic proportions.
And for that, there’s one place they can look to.
Alibaba’s “11.11” Singles Day
Originally, Singles’ Day is an festival for single people in China to celebrate their singledom.
Over the past eight years, it has evolved to become the biggest 24-hour online shopping event on the planet.
Undeniably, Alibaba has been at the forefront of this evolution of Singles’ Day.
“Alibaba’s 11.11 Global Shopping Festival” started in 2009, achieving sales of USD7.6 million in a day.
Today, “11.11” as it’s come to be called, is more than 18 times the size of Amazon Prime Day and 2.5 times bigger than Black Friday and Cyber Monday combined.
Last year, the festival generated USD17.8 billion in Gross Merchandising Volume (GDV), a 32 per cent increase from 2015.
To put in context, that’s bigger than the GDP of Laos and Brunei, and almost four times the GDP of Fiji.
On the day, Alibaba Cloud processed 175,000 orders every second, and its payment hub Alipay processed more than 120,000 transactions per second. Alibaba’s logistic arm, Cainiao processed more than 657 million delivery orders.
Singles’ Day 2017
After a record-breaking 2016, Alibaba has its sights set on the greatness, yet again.
The e-commerce giant said that this year, over 140,000 brands will participate in Singles’ Day, more than 60,000 of them are international brands.
Over 1 million merchants will take part, and Alibaba said its targeting 100 million Chinese consumers outside of China alone – not including the 1 billion or so in China and citizens of other countries (they’re big in Russia, for example).
The Cainiao Network expects over 3 million logistics personnel to handle all the packages that are going to come through. It has invested over USD200 mil to upgrade its facilities and services in anticipation of this.
A glimpse of our future?
It may take time our own SMEs to reach the scales of Alibaba’s Singles’ Day – the e-commerce giant took a good seven or eight years themselves to achieve such proportions.
But the journey of a thousand miles begins with the first step, and as far as future prospects are concerned, we are on the right track.
Back to DFTZ, examples of this “improving, streamlining and digitalising of services” have been seen – from upgraded facilities, to little robots that are handling packages in the KLIA Aeropolis right now as we speak.
So for a majority of our SMEs, especially those who were not part of the 1,972 that have been selected so far, they have good reasons to be optimistic about the future.
In a challenging and unpredictable global economy, Malaysia is indeed taking steps to evolve, and in fact, step ahead of the curve (the DFTZ is the first of its kind in the world). The day when sales of our companies will be bigger than the GDP of some countries may come sooner than you think.
And it’s going to start with our SMEs and small businesses who make up some 90 percent of our economy – and with the DFTZ, it starts now.
Just watch Alibaba’s Singles’ Day Festival this 11.11 (11 Nov) – and I will be there in Shanghai to cover it.
So, stay tu