‘E-commerce not a luxury’: Alibaba and Dubai government project looks to boost Middle East F&B exports
E-commerce has been a booming retail market in many countries for several years, but in the Middle Eastern region this trend only really started to pick up steam in the last couple of years due to the COVID-19 pandemic.
Even so, research by global e-commerce firm Shopify has shown that at present online retail only makes up about 2% of sales in the market, and although this number is growing rapidly due to rising wealth and demand for convenience in the region, firms looking to grow at a more accelerated pace whilst still in tandem with the e-commerce trend are undoubtedly looking further.
According to Alibaba CMO Liz Wang, this was a trend that the firm picked up on when in discussion with Dubai Industries and Exports, leading to the establishment of the Dubai Pavillion project on Alibaba.
“The power of online e-commerce has made cross-border trade more accessible than ever especially post-pandemic, and this applies to both B2C and B2B businesses,” Wang told the floor at the recent Dubai Pavillion announcement virtual event, hosted in conjunction with Dubai Industries and Exports Director Exporter Services Abdulrahman Alhosany.
“Alibaba not new to the Middle East and especially Dubai, with 830 UAE companies with almost 12000 products on UAE till date since we entered the region 15 years ago. We know that firms here have gained reach to over 200 countries via this platform, and we wanted to take this a step further with more collaboration.
“As such, from mid-2022 discussions have already been in place between Alibaba and the Dubai Industries and Exports on ways to increase Dubai’s presence on Alibaba. We will be doing this beginning with the establishment of the Dubai Pavillion, and I hereby announce the kickoff of this project which will bring many more opportunities and success to UAE companies.”
Food and beverage firms have been identified as a major target for Alibaba, with the firm’s Global Strategic Partnerships Head Tim Song highlighting this sector as a big industry for growth in 2023.
“Food and beverage is already in general a major target industry for us in FY2023, and based on our research we have noted that this is very well-matched with what Dubai firms already export,” said Song.
“Amongst some key categories that are very well-matched include sugar, chocolate, baked goods, tea, concentrated milk, meat, juices, nuts and many more.
“We have already seen many countries develop their own country pavilions to great success including India, Italy, Japan, Pakistan, Kazakhstan and more – with food and beverage being anchor categories for several of these.
“The pavilions have been well-recognised as a good strategy for firms to gain better exposure and be more directly seen by global buyers, and we hope to replicate this success for Dubai as well.”
In order to entice local businesses to join the platform - many of which are likely to have little to no e-commerce experience – Alibaba’s Middle East and Africa managing partner Youssef Mohamed said that they have already planned out comprehensive packages which include very in-depth assistance for firms.
“E-commerce is not just a luxury anymore for any businesses, it is now another necessary channel to increase exposure and reach,” he said.
“We do understand that there are many new to this space and may need more support, so in partnership with Dubai Industries and Exports we have exclusive packages that include various things we will set up and put in place including product showcase, mini websites, marketing and most importantly, training.
“The exclusive package will be for 24 months, a long enough time to provide sustainable backing for firms to be established on Alibaba, and in the meantime we are also introducing Alibaba.com Seller Training E-courses (ASTE) for the Dubai market for the first time ever, provided by certified lecturers, to teach firms what they need to know.”
Access to China
Alibaba has also introduced a new scheme this year to increase businesses’ access to the China market, dubbed the Export to China programme, expected to be highly popular as a means for firms worldwide – not just in the Middle East – to gain access to the notoriously challenging Chinese market.
“Alibaba has previously focused a lot on helping global businesses access and export to other global markets, but not so much into our home market China,” said Song.
“We are aware that this is a market that many businesses, [including] those from the Middle East and especially for those manufacturing food and beverage products, are interested in accessing but have found challenging, so this new Export to China programme has been introduced to help improve this.
“There are several models Alibaba is planning for this, including a B2B model where Alibaba will directly purchase products from global suppliers and sell these on the Alibaba China wholesale market; or the B2C/BBC model where we buy from global supppliers and store the products in duty-free warehouses in China, then sell and deliver these when orders are made by Chinese consumers on e-commerce platforms such as Tmall or Taobao.”
The programme’s first key target categories are all food and beverage ones: snacks, beverages, fruits, nuts, cookies, and cooking oil.