The ongoing pandemic is a challenge for MSME owners to innovate their products in order to maintain or even increase the number of their consumer transactions. Nowadays, every business owner is challenged to choose whether they want to stick with the old business model or consider to go on a way to digital platforms to create new opportunities. Unfortunately, there are still many business owners who do not realize the importance of digitalizing their MSME during this 4.0 industrial revolution era. This is proven by the small percentage of MSME owners who are digitally connected, which is only 13% or the equivalent of only eight million people.
Therefore, it is very important for MSMEs to go digital because communication between business owners and consumers will become easier that way so that the opportunity for increasing customer transactions will be wide open and the economy sector can rise again. Here are 3 reasons why digitalization is important for MSMEs:
1. Changes in People’s Consumption Patterns
The COVID-19 outbreak has led to the emergence of social distancing policies in order to minimize the spread of the corona virus. This, of course, has provoked a change in people’s shopping habits, which has been converted from offline to online shopping. This change in people’s spending habits has spread to even remote villages. As result,
MSMEs need to adapt to this new conditions.
Therefore, it is important for MSME owners to start switching to digital and turn their business into online so that customers can access their store easily with only a smartphone. You can choose a marketplace as a first step to promote your product or build your own website to get more freedom on data access.
2. More Cost Efficient
MSME owners sometimes are limited by the amount of capital they have. For instance, they cannot afford to pay rent for a strategic place for a physical store. In fact, this has become one of major obstacles for most MSMEs. Now, by switching to digital, MSMEs only need to spend capital to buy a domain, rent hosting, and have the option to manage their own website or use an agency service. This way is surely much more cost-efficient, right?
Capital for an Offline Store:
Rent fee: 5,000,000/month
Product Stock: 3,000,000
Employee Salary: 4,000,000
Shop Design: 700,000
Delivery service: 300,000
Capital for an Online Store:
Cloud Hosting Rental: 150.000
Website Maintenance: 500,000
Employee Salary: 4,000,000
Content on Social Media: Free
3. Marketing Opportunity
For a small-scale business, the limitations of product distribution and marketing are ones of the obstacles that can decrease profit opportunities. In fact, in the digital era like today, business owners have the same opportunity to reach the target market to remote villages due to the high number of internet users in Indonesia.
The application of digitalization in developing MSMEs needs to be maximized so that MSMEs can go beyond marketing boundaries. If in the past, the scope was limited to only the people living around the store location, now MSMEs can take advantage of the digital ecosystem using social media and websites to expand their market reach. In terms of logistics, you can set a special place for your products storage so they are easily distributed and not scattered.
After reading the article above, now you know how important it is for MSMEs to go digital in the era of the industrial revolution 4.0. As a new breakthrough during the pandemic, digitalization offers an easy access so that our businesses will remain relevant from times to times. Every need related to business transactions can be completed only with an internet connection and a smartphone.
In addition, you might also want to apply payment digitalization to your business in order to provide a seamless shopping experience for your customers. By presenting various payment options using the Duitku Payment Gateway, your customers can choose the payment method they want to use and make transactions without being limited in time.
Duitku is also equipped with a Fraud Detection System and has met PCI-DSS security standards so that sensitive consumer data will be protected very well. With this way, surely the consumer’s digital payment process will be more secure and convenient. Let’s start your success with one transactions with Duitku!