Export electronic product to malaysia via cross border ecommerce for shopee vietnam potential and solutions

ACADEMY OF POLICY AND DEVELOPMENTINTERNATIONAL SCHOOL OF ECONOMIC AND FINANCE GRADUCATION THESIS Topic: “EXPORT ELECTRONIC PRODUCT TO MALAYSIA VIA CROSS-BORDER ECOMMERCE FOR SHOPEE VIETN

ACADEMY OF POLICY AND DEVELOPMENT

INTERNATIONAL SCHOOL OF ECONOMIC AND FINANCE

GRADUCATION THESIS Topic: “EXPORT ELECTRONIC PRODUCT TO MALAYSIA VIA CROSS-BORDER ECOMMERCE FOR SHOPEE VIETNAM: POTENTIAL AND SOLUTIONS”

Student full name: Tran Huong Ly

Hanoi, Jun 2020

I hereby declare that the topic: “EXPORT ELECTRONIC PRODUCT TOMALAYSIA VIA CROSS-BORDER ECOMMERCE FOR SHOPEEVIETNAM: POTENTIAL AND SOLUTIONS” is an independent researchwork under the guidance of the instructor: MSc Hoang Kim Thu I do not haveany copying by others The topic, the content of my thesis is the product that Ihave made efforts to research during my study at the University The data andresults presented in the thesis are completely honest I would like to take fullresponsibility and discipline of the subject and the University if there is aproblem.”

1 Reasons of choice

Along with the development of international integration orinternationalization, traditional international trade methods have shortcomingsthat cannot meet the needs of the market Meanwhile, e-commerce is also aplatform of commerce, which has been developing in many countries aroundthe world Today's popular forms of commerce such as e-commerce and e-business have quickly become one of the essential components of corporatestrategy and a catalyst a strong catalyst for economic development Inaddition, the development of the internet, communication, and the integration

of information and communication technology (ICT) in enterprises have madethe distance between businesses and consumers become shorter (in otherwords, businesses now it's easier to reach customers), that's not just within acountry, but across countries Thereby promoting the economic development

of a country and promoting international cooperation, export, and tradebetween countries in the region and the world

Vietnam is considered as one of the fastest-growing e-commerce markets

in Southeast Asia, with high and continuous growth from 2015 to the present.E-commerce has played an important role in national economic development.According to the Department of E-commerce and Digital Economy (Ministry

of Industry and Trade), the growth of Vietnam's e-commerce market is at thehighest level in the past 3 years, the total retail sales of goods nationwide in

2019 reached 4.2% In 2019, the whole country had 39.9 million peopleparticipating in online shopping, the average online shopping value per capitareached 202 USD In addition, with the emergence of the Covid-19 pandemic,promoting Vietnam to catch up with trends in the world, promotinginternational trade and exchange of goods through the platform of e-commerce and commerce cross-border electronics

Shopee Vietnam is one of the leading e-commerce companies in Vietnam,established in 2015, providing online shopping services via mobile phoneapplications Currently, Shopee's offices are present in 10 countries around theworld, with the Shopee app being popular in 8 out of 10 countries Along withthe rapid development and demand of the market, Shopee Vietnam has beenimplementing a strategy of trade exchange and export of goods on a cross-border e-commerce platform to Southeast Asian countries, especially toMalaysian market – one of the fast growing of Shopee in Southeast Asian.The Malaysian government is implementing many policies to push thedevelop of using ecommerce, Malaysian consumers have high level of usingtechnology and shopping online via ecommerce platform In addition, theelectronic product has contributed to the main activity on ecommerceplatform and one of the potential export products of Vietnam, this type ofproduct does not use any preservatives or additives as agricultural product,therefore it is suited for exporting.

This report “Export electronic product to Malaysia via cross-border ecommerce for Shopee Vietnam: Potential and Solutions” would like to point out the potential of exporting electronic product to Malaysia by Shopee

Vietnam's CBE strategy and proposed solutions for cross-border trade Thestructure of the report consists of the following three parts:

Chapter 1: Literature review

Chapter 2: Potential for export electronic product to Malaysia via

Cross-Border Ecommerce of Shopee Vietnam

Chapter 3: Recommended solutions for export activity of electronic

goods to Malaysian market of Shopee Vietnam

2 Research objectives and mission

2.1 Research objective

Based on evaluating the operation situation of Shopee company, thedemand and potential of Malaysian market, the status of exporting electronicgoods on the cross-border e-commerce platform of Shopee VietnamCompany The topic is implemented to propose solutions to promote exportVietnam's electronic goods export to Malaysia market via the cross-border e-commerce platform of Shopee Vietnam Company.

2.2 Research mission

To achieve the above goal, the thesis focuses on solving the followingfour tasks:

➢The theoretical basis of electronic goods export activities

➢The theoretical basis of e-commerce activities and cross-bordere-commerce

➢Analysis of the current situation of exporting electronic goods

on the cross-border e-commerce platform of Shopee Vietnam to theMalaysian market

➢Proposing solutions to promote the export of Vietnameseelectronics to the Malaysian market through Shopee Vietnam'scross-border e-commerce platform

3 Research methodologies

3.1 The method of data collection

Sources of information and data, the research uses three main sources

of information: from the market analysis report of the Department of commerce and Digital Economy (Ministry of Industry and Trade), theInternet, and some other scientific research articles The method of datacollection in the thesis is mainly the observation method

E-3.2 Methods of data analysis

Some traditional methods such as data summarize, comparison andcontrast method, and logical method had been used in this research.

Data summarize (or information summarization) is the primary step

in insights, it is pointed at extricating valuable data and common patternsfrom the crude data Two strategies for information summarization arethrough tables and charts

Data comparison and contrast technique use the data that had been

carefully collected to define the performance of the objectives in other sources

Logical method is based on international theory and experience to

analyze the export process of Vietnam's electronic goods

CHAPTER 1: LITERATURE REVIEW 1

1.1 Theoretical background of export 1

1.1.1 Definition and characteristics of export 1

1.1.2 Classifications and forms of export 3

1.1.3 Roles of export 6

1.1.4 Criteria for evaluating export performance of a business 9

1.2 Theoretical background on export via e-commerce cross border 11

1.2.1 Definition and benefit of e-commerce 11

1.2.2 Definition of e-commerce cross-border 15

1.2.3 Characteristics of export via e-commerce cross border 16

1.2.4 Benefits of export via e-commerce cross border 17

1.2.5 Factors affecting export via e-commerce cross border 18

1.3 Overview of electronic product 20

1.3.1 Definition of electronic product 20

1.3.2 Classifications and characteristics of electronic product 20

1.4 Case study: Alibaba Cross-border e-commerce 21

1.4.1 Alibaba’s Cross-border E-commerce Profile 21

1.4.2 Lessons from Alibaba’s CBE platforms for implementing CBE for Shopee Vietnam 25

CHAPTER 2: POTENTIAL FOR EXPORT ELECTRONIC PRODUCT TO MALAYSIA VIA CROSS-BORDER ECOMMERCE OF SHOPEE VIETNAM 27

2.1 Overview of Shopee Vietnam 27

2.1.1 General information about Shopee and Shopee Vietnam 27

2.1.2 Historical development 29

2.1.3 Core strategies 29

2.1.4 Field of business 31

2.1.5 Retail process 32

2.1.6 Organizational structure 33

2.1.7 Partners and Competitors 35

2.1.8 Business performance of Shopee Vietnam from 2016 - 2020 36

2.1.9 Comparison between traditional export method versus CBE of Shopee Vietnam 39

2.1.10 Factors affecting Shopee Vietnam’s export performance 43

2.2 Orientation in the development of Shopee in 2021 45

2.2.1 Principal targets of the Company 46

2.2.2 Growth strategy 47

2.3 Potential to export Vietnamese electronic products to Malaysia via cross-border e-commerce 49

2.3.1 Overview of Malaysian electronic market and ecommerce development 49 2.3.2 The demand for electronic products via e-commerce of Malaysia 54

2.3.3 Malaysia’s regulations on import electronic products from Vietnam 56

2.4 Exporting electronic goods of Shopee Vietnam to Malaysia 58

2.4.1 Process of exporting electronic goods via CBE of Shopee Vietnam to Malaysia 58

2.4.2 Certain results of Shopee Vietnam's CBE project 59

2.5 Evaluation and forecast business performance of CBE project by Shopee Vietnam 60

CHAPTER 3: RECOMMENDED SOLUTIONS FOR EXPORT ACTIVITY OF ELECTRONIC GOODS TO MALAYSIAN MARKET OF SHOPEE VIETNAM 63 3.1 SWOT analysis 63

3.2 Possible solutions for enhancing export performance via cross border ecommerce for Shopee Vietnam 67

3.2.1 Marketing approach 67

3.2.2 Logistics operation 68

3.2.3 Business management 68

3.2.4 Sale and customer service 69

3.3 Recommendations to Vietnam’s authority 69

CONCLUSION 71

REFERENCES 73

CIFCBEGDPUNCTAD

USGMVADOICT3PLASEANEU

LIST OF TABLES AND FIGURES

Figure 2.3: Traditional export supply chain

Figure 2.4: Detailed process flow of CBE method of ShopeeVietnam

Figure 2.4: Order flow of CBE of Shopee Vietnam

Figure 2.5: Online retail value across ASEAN

Figure 2.6: Foreign online retail value across ASEAN

Table 2.2: Compare the characteristics of e-commerce

platforms in Malaysia

Figure 2.7: Ecommerce spends by Category in Malaysia, 2020

Figure 2.8: The six Thrust Areas of the National eCommerce

Strategic Roadmap

Figure 2.9: ADO/ADGMV in May and forecast of ShopeeVietnam

CHAPTER 1: LITERATURE REVIEW

1.1 Theoretical background of export

International trade is one of the imperative trade exercises of outsideexchange, reflecting exchange connections between nations within the locale andthe world Trade exercises presently take an importance role on a worldwide scale,

in all divisions and businesses of the economy, from generation materials toshopper items, from the littlest components to all sorts of items complexapparatus, high-tech innovations, not as it were unmistakable products butmoreover intangible products with an expanding extent

1.1.1 Definition and characteristics of export

1.1.1.1 Definition of export

According to Investopedia, updated 2021, exports are commodities andservices produced in one country and sold to purchasers in another Internationaltrade is made up of exports and imports

According to Clause 1, Article 28, the Vietnamese Commercial Law, 2005,export is defined as “Export of goods is the act of bringing goods out of theterritory of Vietnam or into a special area located in the territory of Vietnam, which

is considered a separate customs area as prescribed by law.”

The economy is developing endlessly, it brings all the activities developedand expanded its definitions In this research, the definition of export will befollowed the Vietnamese Commercial Law, 2005 Therefore, all the practice ofbringing goods out of the Vietnamese border into another area will be defined asexport

1.1.1.2 Characteristics of export

Export activity is the expansion of domestic trade relations abroad, so it isoften more complicated than domestic trade Here are some characteristics whentrading with foreign countries:

Firstly, customers in export activities are foreigners, so when they want to

approach and transact with them, exporters cannot apply the same measures as whenconquering domestic customers Because these two types of customers have manydifferences in terms of language, lifestyle, customs, etc This will lead to differences

in needs and ways of satisfying needs Therefore, exporters need to study carefully tounderstand the needs and tastes of foreign customers and export the right goods

Secondly, doing business in the export market is often more complex and

difficult to access than the domestic market

Because the export market is located outside the national borders, it isgeographically farther away, therefore, exporters will need intensive marketresearch campaigns to understand the tastes customer Depending on the laws ofeach country, the business market will be complicated and there are binding factorswhen exporting and importing goods, requiring the exporter to have a certainunderstanding of the foreign market and have strategies for exporting andimporting goods An effective strategy in sales and marketing of goods

Thirdly the form of trading in export activities is usually trading through export

contracts with a large volume of purchase to be effective

Exporting goods at home or abroad requires the use of expensive means oftransportation Exporting goods abroad increases the cost, small orders cannotcompensate for the cost of shipping

Fourthly, operations related to export activities such as payment,

transportation, and signing of contracts are complicated and contain many risks.(Pham Thanh Hai, 2013)

1.1.2 Classifications and forms of export

1.1.2.1 Direct export

This is the export of goods and services produced by enterprises themselves

or purchased from domestic production units to foreign customers through theirorganizations (Le Ngoc Hai, 2013)

In case the enterprise participating in the export is a commercial enterprisethat does not produce its products, the exportation includes two stages:

Stage 1: Purchasing to create a source of export goods with domestic unitsand localities

Stage 2: Negotiate signing with foreign enterprises, delivery, and paymentfor goods with your unit

This method has several advantages that through direct negotiations, it iseasy to reach an agreement and there are fewer unfortunate misunderstandings,thus: (i) Reducing intermediary costs thereby increasing profits profits forbusinesses; (ii) There are many conditions to promote the independence ofenterprises; (iii) Be proactive in consuming their goods and products

However, the limitations of this method also reveal some disadvantages such

as (i) Risks are easy to occur; (ii) If there is no qualified and experienced export officer when entering a contract in a new market or making mistakes thatare detrimental to them; (iii) The volume of goods when participating in thetransaction usually has to be large to cover the costs of the transaction

import-For example, when participating in direct export, it is necessary to preparewell many tasks such as: researching carefully about the customer, the type ofgoods to be purchased and sold, the transaction conditions for the exchange, it isnecessary to clearly define goals and requirements of the job; select qualifiedpeople to participate in transactions, consider the volume of goods and servicesnecessary for the effective transaction.

1.1.2.2 Entrusted export

Entrusted export is a form of business in which the import-export unit acts as

an intermediary on behalf of the manufacturer to sign export contracts and carryout necessary procedures for export the producer and thereby enjoy a certainamount called the commission fee

This form includes the following steps:

Step 1: Sign an export entrustment contract with a domestic unit

Step 2: Sign export contract, delivery, and payment for goods abroad

Step 3: Receive export entrustment fee from the domestic unit

The advantages of this method are: (i) Trustees understand the local legalmarket situation and customs, so they can promote trade and reduce entrustment tothe trustee waterfall; (ii) For the trustee, it is not necessary to invest capital in thebusiness that creates jobs for employees and also earns a considerable amount ofmoney

However, the use of intermediaries, besides the positive aspects mentionedabove, also has significant limitations such as (i) Import-export companies that losetheir direct connection with the market often must respond to the claims of theintermediary; (ii) Profits are shared

1.1.2.3 Countertrade

a Definition

Countertrade is one of the trade exchange strategies in which sends out areclosely combined with imports, where the vender is additionally the buyer, the sumtraded with each other has the same esteem In this mode of trade, the objective is

to get numerous products of break even with esteem Since of this feature, thisstrategy is additionally known as connected consequence and trade, or trade

b Requirements

The parties involved in countertraction always have to pay attention to the balance

in the exchange of goods This balance is reflected in the following aspects:

(i) Equilibrium in terms of items: quarterly goods exchanged for quarterly goods;inventory items exchanged for difficult-to-sell inventory; (ii) Equilibrium in pricecompared to actual price if the price of imported goods is high, then whenexporting to the opponent, the export price must also be calculated accordingly andvice versa; (iii) Equilibrium on the total value of goods delivered to each other;(iv) Balance on delivery conditions: if exporting CIF, must import CIF

c Types of countertrades

Convective trade has existed for a long time in the history of money relations Countertrade includes the following types: Barter trade; Clearingoperations; Convective buying operation; Service of transferring obligations;Chargeback transaction; Business acquisition

commodity-1.1.2.4 Some other forms of export

Besides the above-mentioned forms of export, there are also some fewercommon forms of export such as:

Export of goods under the protocol, the form of export of goods (usually for

debt) signed under the protocol between the two Governments

Exporting on the spot, a new business form but is developing widely, due to its

advantages

International outsourcing, this is a business method in which one party is

called the party receiving raw materials or semi-finished products of another party(referred to as the outsourcing party) to process the finished products and deliverthem to the customer the party ordering the processing and receiving remuneration(referred to as processing fee)

Temporary import for re-export, this is a form of re-exporting to foreign

countries the goods that were previously imported, unprocessed in the re-exportingcountry Through a re-export contract, including import and export for earn moreforeign currency than the initial amount spent

an open arrangement of the economy to require advantage of outside capital and

innovation, combining them with the household potential of labor and normalassets to make solid development for the economy, contributing to narrowing thecrevice with wealthy nations.

Exports create capital for imports and serve the country's development.

Industrialization of the nation in suitable steps is an unavoidable way toovercome the destitution and underdevelopment of our nation, to realize thecountry's industrialization requires a gigantic sum of capital to moment apparatus,gear, strategies, materials, and progressed innovation from exterior, to prepare thegeneration base The capital sources such as remote venture, credits, and help toneed to be paid in one way or another, whereas help and remote speculation areconstrained, moreover, these sources are regularly subordinate on outside nations.Subsequently, the foremost vital source of capital for imports and sends out Thereality is that sends out decide the measure and development rate of imports, whichnation can increment sends out, imports will increment appropriately On theopposite, on the off chance that imports are bigger than trades, the exchange adjustshortfall will be as well expansive, which can unfavorably influence the nationaleconomy

Export creates jobs and improves people's lives.

The effect of sends out on people's lives incorporates numerous angles Tobegin with of all, fabricating for trade could be a put that draws in millions oflaborers to work with great pay The fabricating and handling businesses for sendout are straightforwardly pulling in millions of laborers to work In our nationnowadays, since the Party and State actualized the approach of opening theeconomy, our country's trade turnover has ceaselessly expanded, making favorableconditions to advance the improvement of residential generation and create pay.budget and make jobs for millions of workers In expansion, amid the method of

trading merchandise, the workforce included in trade administrations isn't little.Sends out also increase GDP, increment national salary, subsequently expandingresidential utilization Hence, individuals will have a better request for high-classmerchandise as well as for the abundance and differing qualities of items Otherthan, trades are one of the biggest sources of outside cash request for the nationalproduction and produce income budget and make occupations for millions ofworkers.

In expansion, amid the method of trading merchandise, the workforceinvolved in trade administrations is not little Trades too increment GDP, incrementnational pay, in this manner increasing domestic utilization Hence, individuals willhave a better request for high-class merchandise as well as for the abundance anddiffering qualities of items Other than, trades are one of the biggest sources ofoutside money request for the national budget This capital source will be ended up

an apparatus to moment fundamental buyer items for life that cannot be createdlocally to serve the expanding and copious request, fulfilling the request of havingnumerous choices more in people's utilization, assembly the higher standard ofliving of present-day life

Exports expand the country's external economic relations.

In economics, international trade and other outside financial connections areforbid: More often than not, send out exercises are born prior than other outsidefinancial exercises, so it advances these relations to create For case, the generationand send out of products advance exercises of credit, speculation, protections,installment, universal transportation, and so on Other than, remote financialrelations too make a introduce, conditions to grow trades The over exercises createand get to be increasingly advanced, which is able make more comfort, speed, and

ease for trade exercises In like manner, trades will be progressively extended andcreated.

In conclusion, send out advancement is considered as one of the foremostkey issues for financial advancement, industrialization, and modernization of thenation; particularly within the current conditions, the drift of globalization andregionalization is taking place unequivocally all over the world and it'll gotten to

be a great opportunity for each nation to coordinated into the world economy andthe locale range

1.1.4 Criteria for evaluating export performance of a business

There are some criteria to assess trade execution of a firm, counting exportmarkets and send out turnovers, which are clarified clearly as underneath:

Export market: As mentioned before, market is the place where buyers and

sellers interact with each other to determine price and quantity of products,whereas export market is a country, or a group of countries purchases goods orservices from companies in the home country Researching export market plays animportant role in helping a firm consider its business scale, its survival as well asits strategic development (Vo & Ngo 2011, p 310 – 312) To exploit potentials of

an export market, any company needs to have an in-depth look at determinants,including: (i) Inquiring about supply and request to conduct suitable item quantitiesthe company is able to offer in trade advertise; (ii) Investigating political issues,financial circumstances, lawful frameworks and trade approaches to have a long –term commerce technique for export showcase; Investigating outside tradedangers, dispersion channels, payment strategies and well known incoterms intrade advertise (Vo & Ngo 2011, p 310 – 312)

Export turnover: According to Statistics Finland, export turnover implies

esteem record of products or administrations that are sold overseas (Tilastokeskusn.d.) In other words, send out turnover can be respected as trade incomes in foreignmonetary forms In addition, it measures add up to values of items each three months

or each year Simultaneously, export turnover is the foremost vital criterium forassessing send out execution of any trade, organization, and country (Vo & Ngo 2011,

p 308 – 309) The common equation for export turnover is s M = P x Q, with:

M: export turnover of a particular product

P: Unit price of the product in export market

Q:Export volume of that product

Furthermore, growth in export turnover is defined with the formula: ∆M = Mt– M0, with:

∆M: Difference of export turnover

Mt: Export turnover of year t

M0: Export turnover of base year

Therefore, growth in export turnover (shown in percentage) is g (%) =

∆M/M0 x 100%, with:

g: Growth in export turnover (%)

Mt, M0, ∆M and g demonstrates changes in quantity or scale of exportproducts That ∆M and g are greater translates to greater changes in export scale,which at the same time shows that the company has been continuously improvingits export revenues (Vo & Ngo 2011, p 308 – 309)

Production cost, the cost of producing exported goods is communicated in

terms of the overall taken a toll of living and materialized labor, and other money

related costs that the maker has went through to carry out generation and make items

or providing services in a certain period Costs within the prepare of obtaining,protecting, planning distribution centers, wharves, and worldwide transportation tobring electronic products to the goal with the worldwide showcase

The selling price of a unit of goods (excluding market factors) reflects the

economic value of the product The high quality of the product, the higher theprice, the preferred by consumers, and the willingness to pay a high price toconsume that product The high selling price of goods will be an opportunity toimprove the value of goods, thus improving the competitiveness of goods Theincrease in the selling price of a product unit depends on the increase of stages inthe production process and supply chain The deeper the product production stages,the higher the processing technology is required, the higher the economic value ofthe quality product, and the higher the selling price

A product's brand and reputation are a combination of product attributes

such as product quality, benefits, design, and service The brand is not only a sign

to identify and distinguish the products of one enterprise from another, but it is also

an asset of the business, the prestige, and the expression of consumer confidencefor products

1.2 Theoretical background on export via e-commerce cross border

1.2.1 Definition and benefit of e-commerce

Appearing and growing for more than 30 years in the World, E-commerceincludes the exchange of data that facilitates the financial resources and paymentaspects of business transactions When the definition of e-commerce in the world isnot clear, e-commerce has been used in some or all the following meanings: E-tailing(online retail) or "virtual store" on the website with online catalogs, sometimesgrouped into "shirt shopping malls" The collection and use of personal data through

our contacts Electronic Data Interchange (EDI), business-to-business dataexchange Email, fax, and how to use them as means for reaching and establishingrelationships with customers Over time, along with the development and scale-up

of operating methods, reputable trade organizations in the world have come upwith the following concepts and definitions of e-commerce

According to the E-Commerce Committee of the Asia-Pacific EconomicCooperation (APEC) defines: 'Private commerce involves commercial transactions forthe exchange of goods and services between groups (individuals) of an electronicnature primarily through Internet-based systems.” Communication techniques that can

be emailed, EDI, Internet, and Extranet can be used to support e-commerce

According to the European Commission: “E-commerce can be broadly defined

as the buying and selling of goods or services between businesses, families,individuals and private organizations by electronic transactions through theInternet or intermediate computer networks (online communications) The termincludes ordering and services over a computer network, but payment and finalshipping of goods or services can be done online or manually.”

“Electronic commerce or e-commerce (also written as eCommerce) is a businessstrategy that allows corporations and individuals to buy and sell products over theinternet” according to Investopedia E-commerce is present in each of the four key

market segments listed below: Business to business (B2B), business to consumer(B2C), consumer to consumer (C2C), and consumer to business (C2B) are allexamples of business-to-business relationships (B2B).

In short, this research will apply the definition: “electronic commerce or commerce (also written as eCommerce) is a business strategy that allowscorporations and individuals to buy and sell products over the internet”

e-1.2.1.2 Benefit of e-commerce

The Internet and e-commerce are transforming the operations of businesses

by redefining how the back end works, including product design and development,marketing, procurement, inventory, distribution, and after-sales service support Ateach stage, the internet and e-commerce replace many of the relationships ofvarious parties, fostering new supply networks, services, and business models Thefinal results are efficiency improvements, optimize the product's operating time inthe market, reduce the time to fill the market (total order fulfillment times), andimprove CS (customer service) In detail, the benefits of e-commerce can bedefined as follows:

For the economy in general, ecommerce boosts the economy by increasing

productivity, encouraging innovation, and driving better shopping experiences In the

world, e-commerce has existed for nearly 2 centuries in different forms, but with thespeed of development of the Internet, ecommerce has been promoted and becomemore popular (is force popularizing) The Internet provides continuous access within24h/day, 7days/week, anytime, anywhere Therefore, time and place are no longer

constrained; E-commerce has contributed to the structure of traditional commerce

with the flexibility offered by electronic networks Through the revamping of

traditional business, this promotes operational improvement, resulting in significantcost savings as well as increased competitiveness and efficiency E-commerce is onesuch activity that has given rise to new dimensions in economic growth and has aided

many countries in recent years in reaching higher levels of development, henceestablishing a favorable investment climate conducive in order to promoteeconomic growth The formation of new economic activities is an important part of

economic development; New productive sectors arise, significantly altering the structure and organization of old operations According to the history of economic growth, such a structural change process is critical for accelerated growth This has

been interpreted by economists as a process of transformation, such as fromagriculture to industry, or as a process involving changes in productivity in newlydeveloping sectors, which pushes up productivity in older industries

For companies, businesses, retailers, e-commerce offers unique opportunities

for restructuring operations and repositioning markets or creating new markets for

each category and category structure; E-commerce is an important factor for the

competitive advantage of businesses in the age of wide information, ensuring access to

new market segments, speeding up business development, minimizing costs related to

procedures and expenses freight charges; Operating costs are guaranteed most

effectively because the operation of e-commerce is non-stop, this is especially true

when the e-commerce floor provides services for the needs of domestic and foreign

consumers; Along with that is customer data, selling online via e-commerce has

provided sellers with a quality database of customers, products when sold online willreach a wide range of customers of all ages and different areas, besides the product arecustomized and installed with marketing and advertising algorithms to easily reach themost potential customers through custom behavior summarized by the association ofmany social sites and media like Facebook, google Therefore, in order to gaincompetitive advantages, enterprises need to look for opportunities for cooperation andcollaboration between supply partners to eliminate inefficiencies in the transportationprocess operations and transactions

For consumers, in the digital age, consumers easily find the products they

want or are looking for, with just one click they can access a wide product variety.

With only the search speed in seconds, consumers can access hundreds of domesticand foreign products sold on e-commerce floors, the products are describedthoroughly and clearly with pictures, practical images and consumers can

communicate directly with the seller Faced with countless options, what

consumers care about now is no longer just the quality of the product, the sellingprice of the product, and the final price of the goods? The operating costs ofproducts in the e-commerce chain have been much reduced compared to the

operating costs of physical stores; That makes it easy for consumers to save costs when buying cassava This is one of the advantages of e-commerce The online

selling price will usually be lower than the retail price For countries in the East ingeneral or Southeast Asia in particular, consumers will not take time to bargainwith sellers of products, moreover, e-commerce websites can offer discounts.Prices and promotions make it easy for sellers to attract potential customers and

consumers in the market; In addition, convenience and safety are guaranteed,

especially when there is an epidemic such as the Covid-19 pandemic Convenienceand time saving are always what consumers in today's era are always aiming for

1.2.2 Definition of e-commerce cross-border

According to the Cambridge dictionary, cross-border refers to something thatoccurs between countries or involves people or businesses from other countries Theterm "cross-border ecommerce" is used to describe transnational internet transactions

It entails the sale or purchase of things from across national borders via onlineretailers Buyers and sellers are often not in the same nation, are governed by separatejurisdictions, use various currencies, and speak different languages

According to Pang, (2015) said CBE refers to a type of internationalcommercial activity in which distinct trade entities (individuals or businesses) from

different customs regions conduct a transaction using an electronic commerceplatform, online payment, and cross-border logistics CBE has a number ofadvantages over traditional trade modes, including minimal transaction prices,quick transaction speeds, and so on.

CBE is considered to be the fastest-growing sector of World Trade From astarting point of almost zero two decades ago, by the end of 2016, cross-border e-commerce (including B2B and B2C business-to-business transactions) wasestimated at US$1.920 billion globally The Asia-Pacific region has the largesttrading volume in the world, followed by Western Europe and North America Interms of B2C e-commerce alone, the Asia-Pacific region's cross-border B2C e-commerce revenue in 2016 reached US$144 billion, accounting for about 35.9% ofglobal B2C cross-border e-commerce revenue CBE is an effective tool to helpsmall, medium, and micro enterprises participating in the globalization process,without a physical or commercial presence in the market, can still sell theirproducts worldwide

In this research, the definition of CBE is defined as international commercialactivities from diverse traditions locales conduct an exchange utilizing anelectronic commerce stage, online installment, and cross-border coordination

1.2.3 Characteristics of export via e-commerce cross border

E-Commerce has a variety of approaches and perspectives Some internationalorganizations and countries, on the other hand, include elements like the use ofinformation and communication technologies and the Internet as a means ofcommunication, transaction initiation, movement across borders from one economy toanother, and electronic payment in their definitions Cross-border E-Commerce isdefined as follows for the purposes of this Framework of Standards:

• Cross-border transactions/shipments

• Physical (physical) items

• Consumer/buyer-directed ordering, sale, communication, and, if applicable, payment

• Online ordering, sale, communication, and, if relevant, payment(commercial and non-commercial)

This Framework primarily establishes standards for B2C and C2Ctransactions Members, on the other hand, are encouraged to apply the sameprinciples and standards to B2B transactions

1.2.4 Benefits of export via e-commerce cross border

CBE has grabbed the globe by storm, as it is fast developing and explodinglike never Merchants can now sell their goods to buyers in different nations Withthe advent of the internet, becoming a worldwide seller and taking advantage ofcross-border e-Commerce benefits has never been easier Because of the existence

of international e-Commerce, the number of online shoppers is steadily expanding

As a result, below are some of the advantages of CBE that can help your companyreach out to worldwide clients

(i) International expansion

Sellers, both merchants and brands, gain from CBE since it allows them todevelop their business into populations with a growing economy Domestic e-Commerce retailers have the opportunity to grow their business and market share.They have the possibility to market their items all over the world

(ii) A rise in revenue

The seller has the opportunity to enter the international market through CBE.When they trade on the international market, their brand becomes more well-known, which leads to increased demand As a result, merchants can enhance theirrevenue in the worldwide market

(iii) Increases the sale of low-demand domestic e-commerce items

A product that isn't well-known in domestic e-commerce may find itself instrong demand in foreign markets Cross-border e-Commerce is a platform thatallows the best products to be sold globally As a result, the seller is able to sell aproduct that has minimal value or recognition in the domestic market to the foreignmarket.

(iv) Better access to end-users

You can attract more customers in the foreign market by lowering the endselling price, which was previously restricted by wholesalers You'll be able toincrease sales and take home a larger portion of the profit margin in this manner

(v) Improved corporate long-term viability

Cross-border e-Commerce is a rapidly growing and popular platform that isgaining traction around the world As a result, merchants do not need to beconcerned because their brand will continue to grow in the foreign market ascustomers become more aware of it

1.2.5 Factors affecting export via e-commerce cross border

(i) Cutting-edge technology

Globalization alludes to the speedy and broad dispersal of innovation, whichhas brought about in an increment within the sum and assortment of cross-borderexchanges in commodities and administrations (Pounder, 2013) Progressed e-commerce advances cut promoting and regulatory costs whereas permittingbusinesses to reach out to far-flung markets (Burinskiene, 2012; Allow and Bakhru,2004; Shama, 2005) The fast-paced web has brought about in a noteworthy increment

in online shopping clients (Okamura, 2006), as well as a bigger worldwidecommercial showcase (Hwang et al., 2006; I-Ways, 2003; Panagariya, 2000;Shewmake and Sapp, 2000) CBE improvement was supported by a blend of the Weband remote exchange From the angle of shoppers, made strides innovation, such ashelpful cross-border installment and extending utilize of savvy versatile,

empowered them to navigate undetectable borders to buy online more basically(Alkaado et al, 2004).

(ii) Increasing demand

Within the age of e-commerce and worldwide organizations, a company'sworking show must be organized around the wants of its clients Poorer quality fakeproducts and item robbery empower customers in developing nations to purchasethings from other countries gradually and routinely In China, middle-class eras bornwithin the 1980s and 1990s have ended up the overwhelming buyer bunches, withincreasing plans to shop online from exterior (Tentinet, 2015; Voyageone, 2015) Bethat as it may, the foremost common reasons for cross-border web buying are a need

of item accessibility and superior costs in other marketplaces

(iii) Beneficial policy

Exchange liberalization, such as the foundation of the European Free ExchangeUnderstanding and the China Free Exchange Zone, expanded trades of merchandiseand administrations to modern markets Already, such exchange was not conceivablesince the net impact of purport duties made competing in remote markets impossible(Pounder, 2013) The advantageous approaches will open up modern markets forexchange, counting those from creating nations (Nielson and Morris, 2001) TheChinese government sanctioned a slew of pro-CBE arrangements (Analysys, 2015;CECRC, 2015), set up a number of free exchange zones to diminish obligations andstreamline traditions clearance methods (CECRC, 2015; PwC, 2015), which hasexpanded outside cross-border deals (McDermott, 2015)

(iv) The level of logistical development

The scope of ecommerce is influenced by the effectiveness and taken a toll ofitem transportation The level of coordination influences the improvement of CBEexchange and could be a noteworthy calculate restricting CBE advancement Fromarrange arrangement to dissemination, the speed and taken a toll of dispersion have

coordinate suggestions for CBE advancement As a result, it is basic to guaranteethe productive and smooth stream of merchandise.

1.3 Overview of electronic product

1.3.1 Definition of electronic product

According to US law, Chapter 96, 2000, an “electronic product” is (A) anymanufactured or assembled product that, when in use, (i) contains or acts as part of

an electronic circuit and (ii) emits (or would emit) electronic product radiation inthe absence of effective shielding or other controls, or (B) any manufactured orassembled article intended for use as a component, part, or accessory of a productdescribed in clause (A) and which emits (or would emit) such radiation in theabsence of effective shielding or other control when in operation

1.3.2 Classifications and characteristics of electronic product

In terms of product design and consumer demand, the electronics industry isdivided into 5 product categories as follows:

Mobile and accessories (phones and accessories): Phones, tablets, cases,batteries, power banks, sims, camera sticks, so on

Consumer electronics (electronic devices): TVs, android TV boxes,headphones, audio equipment, smartwatches, game devices, so on

Computer and laptop (computer & laptop): laptop, desktop computer,computer components, keyboard mouse, network equipment, so on

Camera: camera, camera, memory card, photography aids

Home application or home electronics: kitchen electrical appliances, vacuumcleaners, cleaning equipment, fans, heaters, clothes care, so on

The characteristic of electronic products (in the first 3 groups) is that they

are always renewed every day to meet the needs and preferences of buyers Forhousehold electrical goods, these are essential products, with little variation in

features and designs over the years, buyers are often interested mainly in quality,durability, features, and economy produce electricity.

1.4 Case study: Alibaba Cross-border e-commerce

Ma Yun founded Alibaba Corporation in 1999 Its initial focus was on theB2B online trade market platform business After 20 years of hard work, Alibabahas evolved into a core business that includes e-commerce, cloud computing, bigdata, digital media, logistics, finance, entertainment, and other projects Thedevelopment of China's largest network company, as well as the world's secondlargest network company, can be described as the speed of development

Alibaba has been pursuing its own development for the past 20 years, withthe mission of “making the world a business that is not difficult to do,” and usinge-commerce to change the way of marketing, sales, and enterprise operation hasassisted countless Small and Medium Enterprises (SMEs) around the world todevelop together In the last 20 years, Alibaba has made outstanding contributions

to China and the world in the development of cross-border e-commerce

1.4.1 Alibaba’s Cross-border E-commerce Profile

Alibaba has primarily entered the international market via internationalstrategies such as holding mergers and acquisitions, shareholding investment, andstrategic cooperation Through the successful expansion of the B2B operationmode, it has created an e-commerce ecological chain that has propelled it to the top

of the ecommerce market share As shown in the figure below, Alibaba hassurpassed Amazon to become the world's largest e-commerce company as of 2018.Alibaba's online retail platform gross merchandise value (GMV) has reached

$1,145 billion in the last few years and is still growing

Figure 1.1: Top B2C e-commerce companies by GMV, 2020

(Source: UNCTAD based on company reports)

There are many subsidiaries in cross-border business under Alibaba Amongthem, B2B and B2C are the main modes The following will introduce theAlibaba’s main CBE platforms, which are Alibaba International Station (B2B) andAli-express (B2C)

(i) International station of Alibaba

Main business: Alibaba International Station first opened its doors in 1999 For

the past two decades, it has served consumers in over 200 countries and regionsaround the world, providing excellent services to SME buyers and suppliers in theglobal cross-border e-commerce B2B industry It is already a market leader At thebeginning, Alibaba International Station was primarily an information-integratedplatform that provided high-quality product and company information to buyers,relevant information to sellers, and a good cooperation environment for buyers andsellers However, the emphasis on cross-border B2B development has shifted in

recent years from information-based platforms to transaction-based platforms.Online payment functions and transaction guarantees have been enhanced based onthe original It finally produced results after years of hard work.

Payment method: Prior to Alibaba International Station, the payment method

was online inquiry and offline delivery This method of payment is inconvenient.Nowadays, online trading is Alibaba's primary payment method Orders and deliveriesare handled on a single platform, and the amount of credit available as well as thenumber of transactions are made public This improves transaction efficiency, lowerstransaction costs, and increases customer trust in the platform and customer stickiness.There are far more payment options for platform certification, including MasterCard,Visa, Cheque, Western Union, and so on For example, Russia has access to theRussian online payment tools WebMoney and Qiwi Wallet, while Brazil has access tothe Brazilian online payment channel Boleto

Logistic transportation mode: The logistics and transportation modes used

by Alibaba International Station primarily include shipping, air transportation, andinternational express delivery Shipping is still the most common mode oftransportation Alibaba group cooperates and cooperates with many shippingcompanies with diverse modes of transportation, for transportation by air (in terms

of air transportation), Alibaba cooperates with major carriers such as DHL GlobalForwarding (DHL Global Freight), Kuehne + Nagel and other 10 quality serviceproviders, To meet the individual needs of customers, they collaborate with over

170 countries and regions around the world to provide one-stop services such astrailer, customs declaration, and inspection For international shipping methods, itwill rely on two main forms: warehouse-to-door, and door-to-door, combined withmany reputable shipping units, third-party logistics (3PL) to optimize freight andeffectively reduce transportation costs

(ii) Ali-express

Main business: Ali-express is not only the first cross-border B2C retailplatform in China, but also one of the cross-border export platform groups inChina, and one of the top three online shopping websites in the world Because ofits convenience and timeliness, it has achieved outstanding results in over 200countries and global buyers worldwide.

Payments: International Alipay is a worldwide payment method It accepts a

variety of payment methods, the most common of which are credit card payments(Visa, Mastercard), debit card payments, and so on Four payment methods, which arediverse, are convenient for customers and attract more customers to Ali-express

Logistics mode: Ali-express provides three types of logistics services:

worry-free logistics, online delivery, and overseas warehouses Worry-worry-free logistics is theofficial logistics launched jointly by the rookie network and Ali-express It offers aone-stop shop for logistics solutions such as collection, distribution, logistics tracking,logistics dispute resolution, and payment Ali-express and Rookie Networkcollaborated with a number of high-quality third-party logistics providers to developthe online delivery logistics service system Saver Shipping, Standard Shipping, andPremium Shipping are the three options of overseas warehouses Consumers canselect from a variety of solutions based on their specific requirements1 Onlinedelivery consists primarily of three types of logistics solutions: economical logistics,standard logistics, and rapid logistics Consumers can make their selection based onthe cost of the goods and the availability of information

The above mainly introduces Alibaba’s two CBE platforms, AlibabaInternational Station and Aliexpress Nowadays, these two platforms are perfectsoperation mechanism and high-quality service system have importance referencefor the development of cross-border electricity commerce in China But during the

1 Alibaba International Station Service Center, http://service.Alibaba.com, 2015

construction process, these two platforms have been tacked with many issues,which are about products, payment system and logistics system To gain thereputation as now they had done many solutions and these can be used as thelessons for Shopee Vietnam, as below.

1.4.2 Lessons from Alibaba’s CBE platforms for implementing CBE for

Shopee Vietnam

Firstly, improve product quality through the steps of censorship and

validation of products sold on commercial platforms From the consumer'sperspective, if the product is said to be a fake or defective product, the consumerwill be very disappointed in the product and will lose consumer confidence Thishas a significant impact on the customer shopping experience when browsing thee-commerce floor Product quality and customer shopping experience areimportant to sellers, e-commerce companies, and the entire consumer process.When appearing in the global supply chain, the quality of the said product isaffected by the reputation and reliability of the country and vice versa, the productalso makes a name for the country that exports it As a result, manufacturing andsales companies, as well as e-commerce companies, in general, must regularlyinspect the products sold on the platforms When the product's quality is assured,all subsequent stages will be improved accordingly Second, the Cross-borderpayment system must be constantly improved and upgraded Payment methods are

a critical criterion for assessing cross-border e-commerce

Secondly, the Cross-border payment system must be constantly improved

and upgraded Payment methods are a critical criterion for assessing cross-bordere-commerce The payment platform serves as the foundation for the growth ofecommerce Cross-border ecommerce will be stymied in the absence of a paymentplatform, and a single payment method must be less convenient than a diversepayment method A payment method that is unstable must not be as stable as a

payment method that is stable As a result, the government should actively promotethe development of cross-border e-commerce platforms and cross-border paymentsystems After all, "to be rich, build roads first." Companies must, of course,improve their payment technology to create a more powerful and improvedpayment platform The government and businesses are collaborating to develop acomprehensive cross-border payment system.

Thirdly, to strengthen the logistics system, we can see that logistics is an

inevitable part of CBE, because logistics is a very basic and very important subject

It is a significant challenge not only to deliver goods to consumers quickly andsafely To support the development of cross-border ecommerce logistics, thegovernment should continuously introduce and improve relevant policies Cross-border e-commerce companies can form strategic alliances with logisticscompanies or third-party logistics providers to integrate products and logistics,thereby forming a logistics scale effect A global logistics distribution system can

be formed even after years of development

Table 1.1: Ali-express online delivery logistics solutions

Economic logistic solution

Standard logistics solution

Rapid logistics solution

CHAPTER 2: POTENTIAL FOR EXPORT ELECTRONIC PRODUCT TO MALAYSIA VIA CROSS-BORDER

ECOMMERCE OF SHOPEE VIETNAM

2.1 Overview of Shopee Vietnam

Shopee is the leading e-commerce platform in Southeast Asia andTaiwan Launched in 2015, it is a platform tailored for the region, providingcustomers with an easy, secure, and fast online shopping experience throughstrong payment and fulfillment support

2.1.1 General information about Shopee and Shopee Vietnam

Shopee is a multinational technology company based in Singapore thatprimarily focuses on e-commerce Sea Group's headquarters (previouslyknown as Garena) Shopee began operations in Singapore in 2015 and hassince expanded to Malaysia, Thailand, Taiwan, Indonesia, Vietnam, thePhilippines, Brazil, and Mexico Shopee believes that online shopping should

be simple, easy, and enjoyable This is the vision Shopee aspires to deliver onthe platform every day

Business model, Shopee began as a C2C marketplace, but has since

evolved into a C2C/B2C hybrid Shopee collaborates with over 70 courierservice providers across its markets to provide logistical assistance to itsusers2 For item pickup and delivery in Singapore, it works with logisticsstartup NinjaVan Pos Malaysia and Pos Indonesia are two other regionaldelivery partners

Market share, the platform received 200 million downloads in 2019.

Shopee also saw a 92.7 percent increase in gross orders to 246.3 million in Q2

2019, up from 127.8 million the previous year Its gross merchandise valueincreased 72.7 percent year on year to US$3.8bil in 2Q19 from US$2.2bil the

2 "Sea Limited Form F-1" U.S Securities and Exchange Commission 18 October 2017 Retrieved 10 December 2017: https://www.sec.gov/Archives/edgar/data/1703399/000119312517312363/d363501df1a.htm

previous year The platform received 200 million downloads in 2019 Shopeealso saw a 92.7 percent increase in gross orders to 246.3 million in Q2 2019,

up from 127.8 million the previous year Its gross merchandise valueincreased 72.7 percent year on year to US$3.8bil in 2Q19 from US$2.2bil theprevious year3 These GMV claims have also prompted a backlash fromLazada, an Alibaba-backed competitor Max Bittner, the former CEO, claimedthat GMV figures can be easily inflated "by subsidy schemes, and historyshows that GMV falls away as unhealthy subsidies are removed."

As can be seen, Shopee ranked first with a monthly average of 200.2million visits, while Lazada received 174.4 million Using data from App Annieand SimilarWeb, the report surveyed visits from both desktop and mobiledevices in six major countries: Indonesia, Vietnam, the Philippines, Malaysia,Singapore, and Thailand Additionally, Shoppe is also the most popularapplication of the region with the largest number of monthly active users

2.1.1.2 General information about Shopee Vietnam

Launched in Vietnam on August 8, 2016, Shopee currently has twooffices in Hanoi and Ho Chi Minh City After launching in the Vietnamesemarket for 4 years, Shopee has become the leading e-commerce site inVietnam

In Vietnam's e-commerce market, popular e-commerce products include:Shopee Vietnam, Lazada, Tiki, Sendo, FPT shop, ect In addition, the emergence

of the Covid-19 pandemic has changed customer behavior and promoted thedevelopment of e-commerce in Vietnam In 2020, platforms like thegioididongand Bach Hoa Xanh have achieved 28.6M and 8.8M visits respectively, Tiki hasachieved 22.5M visits, Sendo has achieved 14.3M visits, Lazada has over 137Mvisits visits and Shopee has achieved over 281 million

3iPrice report, 2019, platform-in-southeast-asia

https://kr-asia.com/iprice-report-has-shopee-down-as-the-most-popular-shopping-2.1.2 Historical development

In 2016: Delivernow.vn changed its name and logo to Now.vn and is amember of a social network that reviews and shares food places Foody.vn

August 8, 2016: Shopee was officially launched in the Vietnam market

In 2017: Sea Group acquired 82% shares of Foody

In 2019: Now.vn and Shopee Vietnam merged and integrated on oneplatform, Shopee Vietnam Thereby increasing the access and use of theapplication for many different purposes and needs of users In addition, thepayment connection with AirPay e-wallet has made the shopping process andusing the service of customers convenient and timesaving As of 2019, theplatform recorded 200 million downloads and gross order increased by 92.7percent to RM 246.3 million in Q2 2019, compared to 127.8 million a year ago

In 2020: Shopee Vietnam has established Shopee Express, a freightforwarding unit exclusively for the Shopee ecommerce platform Thus, by

2020, Shopee Vietnam's ecosystem has been guaranteed from operation(product delivery), marketing (enhancement of customer experience whenshopping on Shopee Vietnam e-commerce site with the help of ourcustomers) application of high technology), integrating many features(shopping for groceries and food and paying online) Currently, ShopeeVietnam has more than 9000 employees, more than 200 million downloads onmobile devices, more than 7 million sellers doing business on Shopee, andmore than 30 million followers on social networks Especially, becoming theleading e-commerce platform in Vietnam

2.1.3 Core strategies

To achieve the current success, Shopee has well implemented corestrategies The core strategies implemented by Shopee Vietnam to achieve itscurrent success include:

(i) Priority for Mobile