Sri Lanka considers global online retailer Rakuten for e-commerce entry
View(s):Sri Lanka is considering a strategic, fast-track entry to one of the most coveted online markets in the world-Japan. “Japan is the second biggest retail market in the world. Japanese are also heavy internet users with a large e-commerce base. Using a top Japanese online giant like Rakuten could give Lankan exporters a wide-coverage and a low cost entry to this promising market,” said Sujatha Weerakoone, Director-General of the Export Development Board (EDB) last week.
Ms. Weerakoone was addressing the EDB organised event “Japan’s Rakuten Platform for Sri Lankan Products” for Lankan exporters at the EDB. The session consisted of a special in-depth presentation by Japan’s Takashi Yoshino (Principal, Y and F Associates LLC) who, in his presentation, explained the pros and cons, and how to create an online strategy for Lankan exporters to Japan.
Sri Lanka’s exports to Japan have shown a steady rise. In 2012, total exports to Japan recorded US$215.74 million and in 2013, it rose to $223.82 million. Apparel, tea and seafood (prawns and fish) were the main products in 2013.
Not only in Japan, but across the world, Rakuten (rakuten.co.jp) is considered as one of the largest e-commerce retailers. Within Japan, Rakuten is the largest e-commerce retailer.
“Japan is the second biggest retail market in the world. Japanese are heavy Internet users. Using an online Japanese giant like Rakuten will give us a low cost entry to this market with immediate wider coverage,” she said in comments that were released to the media by the Ministry of Industry and Commerce.
“This is also a novel concept and more importantly, a good, Sri Lankan product validation window. This is also a global online export strategy incubator for us. The lessons from this would be very important for us in placing our export products with top e-commerce retailers of the world. We at EDB are only looking at introducing a test run for to our exporters at present and are not imposing this on them. This online presence will also lift the burden for our exporters from maintaing a ready inventory in Japanese warehouses,” she said.
Mr. Yoshino said that this is a challenge and a try-out for Sri Lankan exporters, adding that “Japan e-commerce market is unlike many international online sales portals we know such as Amazon”.
Many exporters present at the session, expressed their interest towards the initiative. Ushan Edirisinghe, (Senior Marketing Manager – Siddhalepa Ayurveda), said, “This is very interesting. We are willing to take part. There is that initial portal opening fee charged by Rakuten, which is J-Yen 1.6 Million (around US $ 15,700 only) charged for portal opening for a foreign country. If the government is willing to pay this startup fee, then we the Lankan exporters to Japan have an opportunity to join this platform and take up the regular installment payments thereafter to Rakuten by ourselves on a sharing basis -among the participating exporters.”
Siddhalepa exports several of its well- known products to Japan.