F-commerce boom led by women entrepreneurs
The world today is moving faster than ever. With social media taking over how we interact daily, it has become a norm to open mobile phones or any other compatible device, make a few clicks and bring the world to our doorstep. The concept of business is not new to any society. It is one of the most fundamental elements of a transactional economy and a smoother business path may contribute to a great extent to the drive towards a more stable economic picture. However, some crucial points need to be considered to reap the full benefit out of this system. The first point is that a business will thrive only if it can extract the most of its economies, that means a situation where the more the business produces, the more it accrues. From a cost perspective, if the fixed set up cost for a business is relatively low, the business can make profit relatively sooner. So, per unit profit of inputs increases. The second and the more crucial point to keep in mind is that every member of a society should have an equal access to doing business. How can we think of marching towards greater economic prosperity with one half of the population left in the dark?
The facts received a great deal of attention in recent decades. More and more women were venturing out of their comfort to make a fortune for themselves. But this societal change was different from anything we had anticipated before. Most of these women chose social media platforms as their primary business location. Two factors were at play here. Women could effectively run the business without an established outlet which saved them a great deal of money. Secondly, the number of people interested in online purchases were on the rise owing to its convenience. F-commerce has already been thriving in Bangladesh over the last few years thanks to the huge size of the Facebook audience, which, according to data firm Statista, stands at 41 million, placing Bangladesh among the top 10 highest Facebook-using nations. As an entrepreneur, you simply have to post a picture or live stream your items and voilà! You now have access to 41 million people throughout the country.
COVID-19 in the picture
The matter was further bolstered by the COVID-19 pandemic which accentuated a greater adoption of social media. During this time, Bangladesh witnessed a boom in new f-commerce businesses driven mainly by the women of the country. A study has shown that the COVID-19 induced lockdown has brought a huge flux of customers online to look for essentials like groceries, pharmaceuticals, clothing items, food delivery and counselling. Many women were already selling items online, but the changed consumption behavior brought even more women in the picture. Using their skills and innovations women started selling homemade food items, organic food products, clothes, fashion accessories, saplings, and gardening materials. The drive could have come out of sheer curiosity and desire to start something new or from the need to support family upon job loss and pay cuts.
A number of newspapers, sites, and independent writers have featured stories of female entrepreneurs who turned tables by conducting business online, especially on Facebook. A recent estimate says that around 150,000 women are currently running businesses through Facebook alone and some of them earn as much as BDT 1 lakh every month. The number of Facebook businesses led by women have multiplied during the ongoing pandemic. They are also receiving a record number of orders amidst fears of the infectious disease and changed consumption dynamics. This Eid season witnessed nationwide lockdown accompanied with an effort to put strict measures in place to discourage public movement. This pushed many people to resort to online shopping and bump up sales to anywhere from 50 to more than 1,000 every day. With the lessons learnt from last year’s Eid, women entrepreneurs were better prepared this year as they sourced products beforehand, enhanced their marketing and worked on smoothening the delivery service.
A school for women entrepreneurs
Several support groups have also been formed to teach new women entrepreneurs customer relationship skills and managerial techniques to run their businesses smoothly. The most popular of these groups is the Women and E-commerce Forum (WE) which has around 11 lakh members. The platform initially only arranged workshops and networking sessions, but now they are working on creating a database of regional entrepreneurs and helping them get trade licenses. A recent report states that WE has signed a MoU with Ekshop, a digital one-stop platform, developed by Access to Information (a2i).
However, not everyone in this forum is making a fortune. Most earn a decent wage, while some make enough to single handedly run an entire family. But even after that, the patriarchal society we live in creates obstacles for women in every step. Especially in rural areas, female members earning more than male counterparts is looked down upon and often considered a threat to the reputation of the family.
Facebook business requires women to venture out of their house in order to collect the sourcing materials and deliver the products. As many of these businesses are homerun, they do not have employees to do the jobs for them. But the truth lies behind the curtains. It is not the lack of employees that hinder their progress, but rather the lack of safety for business women to travel freely and independently. In cases where a male member of the family is unable to make the delivery, women seek help from delivery men who are discouraged to comply professionally and not take the task seriously, as opposed to when working a man. Women from different walks of life demand a collective action from the government to smoothen their way because they too realize the value of their contribution in prospering our nation.
Challenges for women
The current pandemic has reinforced certain pre-existing bottlenecks in online ecosystems that are key for the development of inclusive F-commerce. Challenges in these areas have affected the capacity of entrepreneurs to operate their business and further highlighted gaps in information and gender equity.
One of the most advantageous points of starting an F-commerce business is also one of its most disadvantageous points. Online presence saves a lot of money considering that physical outlets require monetary investment as well as having to hire employees. However, these tangible elements of a physical outlet work as a document to prove the authenticity of business when asking for a loan. When it comes to businesses on Facebook, online pages do not give the same sense of authenticity. Lenders are often uncertain whether businesses will thrive. To top it off, Facebook businesses start their journey with minimal capital in hand. In case of failure, what will the lender confiscate? The situation is even more difficult for women entrepreneurs. Banks are often unwilling to give loans to women without stating valid reasons. Several threads addressed this issue, and they all called for the attention of the government to address it.
In light of this, the government has decided to introduce a trade license to validate the authenticity of business and streamline the bank loan process and provide tax exemptions. This too comes with challenges as applying for a trade license requires going through a great deal of hassle on its own, especially the constant interference of brokers. Experts have suggested making an online indexing system to register businesses under concerned authority. This could keep the businesswomen in check and provide lenders with certainty of paybacks. This will also assist in reporting complaints and making sure help goes to the right person.
The second challenge arises from the uncertainty of doing business. Facebook business means connecting with customers virtually. Since the beginning of COVID-19 crisis, women entrepreneurs have been using a variety of channels to sell their products. Phone channels, such as text messages and calls were also used. Identifying fraudulence is close to impossible in such cases. Many have reported being tricked into delivering to a fake address. This makes it challenging to correctly anticipate demand for their products. Even when demand soared during 2021’s Eid season, some businesses found themselves with insufficient funds and workforce to scale-up operations. The matter was further complicated by health-related precaution measures. But the situation was better handled during the second wave than the first. Campaigns by the government to spread awareness related to COVID-19 have provided F-commerce businesses greater incentives to capitalize on changed sales composition.
In some cases, new niches have been sought to expand the online business. Before the pandemic, most online pages sold clothing items and makeup kits. Now, many women are selling their homemade dishes, pickles, frozen items, bakery items, handcrafts, bags, and every other item you may possibly need in your day-to-day life. The F-commerce ecosystem of Bangladesh is very crucial in providing women with a sense of self-worth and in marching towards a more equitable society. It is now on us to realize the opportunity at the earliest.