The Hyatt Regency Tashkent hotel hosted a press conference on the occasion of the launch of the project on digitalization of small and medium-sized businesses, as well as on the export of their products in the Middle East and CIS regions using the capabilities of the Zoodmall online shopping platform.
The project was initiated by ZoodMall, with the support of Uzbekistan Post, MyUzCard, Uzbekistan E-Commerce Association, International Trade Centre (ITC) under WTO and UN and Export Promotion Agency of the Ministry of Investment and Foreign Trade.
The annual growth of cross-border online sales is more than 20% worldwide, the volume of sales of which by the end of 2020 was more than 1.6 trillion US dollars. This project will support the export activities of local small and medium-sized enterprises, offering them the opportunity to establish and develop relationships with cross-border customers. The project on export development and digitalization of small and medium-sized enterprises in Uzbekistan will be developed on ZoodMall. The project is scheduled to launch in September 2021, when the first SME entrepreneurs will have the opportunity to present their goods in six Middle Eastern and CIS countries where the company operates, such as Kazakhstan, Iraq, Lebanon, Jordan, Saudi Arabia, and Kuwait. The company plans to invest $10 million from 2021 to 2023 to implement the project.
SMEs in Uzbekistan already produce about 60% of GDP - this indicator corresponds to most developed countries, which is much higher than in Kazakhstan (25.6%) and Russia (20%). One-third of Uzbekistan's population work in SMEs, they produce 27% to 99 % of total goods and services. As a result of digitalization and access to international markets and Uzbek products expansion, the number of orders of Uzbek goods abroad only on the ZoodMall platform is expected to reach 5.3 million worth 1.670 billion dollars over the next three years.
Askarbek Alshanbayev, CEO of ZoodMall, stated that the company, being presented in the Uzbek market for more than 4 years and having millions of active clients, has already provided local small and medium-sized businesses with direct access to all Uzbek consumers, including those from rural areas. "We are #1 platform in terms of sales as well as quantity of orders in Uzbekistan, Iraq, and Lebanon. In Uzbekistan, we have already delivered more than 200 thousand orders in the 7 months of 2021, which equals a thousand parcels a day, and the monthly growth of them is more than 30%. We decided to develop and offer a new export direction because, firstly, we believe that there are many developing companies in Uzbekistan providing good quality products, and many of them are already working with ZoodMall. Secondly, Uzbekistan has all the basic infrastructure needed for exports, namely logistics companies that can deliver products, payment services that help process payments, as well as trading platforms and support for entrepreneurs in terms of digital literacy."
Rustam Dadamukhammedov, Finance Director of Uzbekistan Post, expressed his support for the project and mentioned: "Under this project, entrepreneurs can also take advantage of the special tariff of Uzbekistan Post to send their products for export.
According to Protocol № 1 from 26.01.2021 of the meeting of the governmental Commission on Development of Export and Investment for organizations - exporters are given a 50% discount on the tariff for sending goods for export by mail. And this possibility can be used by small businesses by sending goods to any post office throughout Uzbekistan, including the most remote areas and settlements.
This project corresponds to the global trend, which we have observed in recent years, where the wholesale trade (B2B), in which goods from producer to buyer passes at least 7 stages, is increasingly losing its position in favor of direct (B2C) sales, in which businesses sell directly to the consumer through online trading platforms or online stores.
To provide a smooth and reliable logistics process, MyUZcard and ZoodPay have launched a process to support local SME merchants in operational activities, including collecting money and ensuring an upfront payment for each product sold. In this case, the merchant will not suffer from cash shortages and will not have to wait for product delivery to receive payment. In addition, by offering cross-border buyers the opportunity to receive the goods and pay later, ZoodPay will introduce foreign buyers to Uzbek products, which can help eliminate buyers’ mistrust.
With the support of Uzbekistan Post, Uzbekistan E-Commerce Association, International Trade Center (ITC) at WTO and UN, and the Export Promotion Agency of the Ministry of Investment and Foreign Trade, ZoodMall will help small and medium-sized entrepreneurs to go online. The project plans to work with small and medium-sized enterprises in rural and urban areas of Uzbekistan to help them digitize and promote their products, online sales to local and foreign buyers in the Middle East and CIS countries, and educate and train local entrepreneurs in digital sales and e-commerce.
Currently, the international platform ZoodMall has more than 7 million active customers and the launch of this initiative, will raise awareness and bring Uzbek products to foreign markets in the Middle East and CIS countries. This will allow small and medium-sized enterprises to increase their business activity, as well as the number of sold products.