Store owners see challenges displaying goods on trading floors

Many shop owners and trading floors have not been able to find common ground, leading to discouragements in their economic partnership.

Selecting goods on an e-commerce trading floor (Photo: SGGP)

Several enterprises, especially small and medium-sized ones, are yearning to enter renowned trading floors and supermarkets to increase their brand recognition and expand their market. Yet the sad news is after some time, they themselves wish to opt out since it takes them too much money to stay there.

D.N., director of a business specializing in produce processing and trading (both nationally and internationally), admitted that for his merchandise to be displayed in supermarkets, he has to pay different expenses, to have his goods undergone quality control, to offer a 15-30 percent discount rate to retail systems. That is not to mention mandatory participation in promotional campaigns of those trading floors at special events.

For the products to appear on online trading floors like Sh., the service expenses are also extremely high of up to 23.5 percent. That includes advertising (6 percent), packaging (1 percent), cost of risk (2 percent), soft costs (1 percent), tax rate (1.5 percent), and the fee paid to that e-commerce floor (12 percent).

However, payments from these systems are often delayed by 45-60 days, or even 90 days. These factors have negatively affected the profit that the business can earn, making him stop the partnership with these trading floors.

Agreeing with that, another business owner dejectedly shared that it is too hard to let his merchandise enter supermarkets or other prestigious trading floors, but then consumption is too slow there. Hence, he has decided to switch to better marketing methods for his goods like self-advertising and livestreaming on social network sites.

Obviously, for a long-term partnership between merchandise suppliers and supermarkets or e-commerce trading floors, there should be a fairer playground.

On their side, managers of a large-scale retail system in HCMC commented that they have tried to support shop owners and businesses. Nevertheless, they have different costs to pay as well, like premise leasing, utility bills, staff salary. They themselves are merely an intermediary between suppliers and buyers, and they cannot cut costs further.

In addition, the space for goods display is rather limited but has to accommodate hundreds of brands. The race for a part of that restricted space is extremely harsh. Meanwhile, to have an eye-catchy location, businesses do have to pay more.

The e-commerce trading floor Shopee has already made action in response to a report from the community that the time to send payments to shop owners after a successful transaction is too long. It now agrees to send the money after 3 days for regular orders and 7 days for those created on Shopee Mall. As to buyers, Shopee still maintains the 15-day return policy.

At a recent working session between the HCMC Industry and Trade Department, modern retail systems, and goods suppliers, there was a strong stress on better cooperation among stakeholders for mutual benefits in the future.

However, seeing that inadequacies still exist, it seems that the applicable policies of leading e-commerce trading floors and retail systems are more and more challenging for small and medium-sized enterprises, despite the fact that these businesses account for 96 percent of the total companies in the country as well as 40 percent of the national GDP.

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