PETALING JAYA: Online marketplace operator Macro Tech Ventures Sdn Bhd, via its platform Borong, aims to reach 300,000 customers in Malaysia and Indonesia this year, underpinned by demand for digital solutions and consumption patterns in the region.
Co-founders Lennise Ng and Haslinda Rasip – who are CEO and chief technology respectively – disclosed this in an exclusive interview with SunBiz.
Ng said: “We are optimistic in terms of digital implementation. We’ve seen a lot of the leaders and governments across the regions that we operate in doubling down on implementing digital solutions, involving the entire ecosystem, and at the same time encouraging more MSME to adopt digital solutions as well as even their own government agencies; for example, Madani’s initiative of electronic invoices.
“On consumption patterns, we definitely see a shift. We have started seeing trends of consumers looking for alternative products in the market. The divide between the rich and the poor is getting bigger and, because of this, the patterns and the areas of what they are purchasing also differs. In terms of transactions and sales, it will affect businesses given if they are slower to adopt tech, meaning they don’t have the insights and cannot move flexibly.”
She added that regardless of size, enterprises should be flexible enough to understand their customers, product movements and distribution to change and adapt to market needs.
Currently, the company has more than 200,000 clients in the three countries that it operates in, with the bulk of its revenue contributed by Malaysia (70%), followed by Indonesia (25%) and Singapore (5%).
In terms of market share in Malaysia, Ng said the company operates about RM3 billion in transaction volume annually.
“We are already operating breakeven as a tech company. For next year, we are quite optimistic in terms, of how we’re able to grow that ... at least we (aim) to grow 20% of our net profit,” she added.
In terms of challenges, Ng said digital adoption is still low in Malaysia, primarily due to lack of awareness or education among businesses. She encouraged MSMEs to take small steps towards digitalisation through utilising digital tools, even those that are available free of charge.
“Transforming your business to be in the digital era is about figuring out what works for your business first. Those that we work with, we tell them that they don’t need a full-fledged entire ERP (enterprise resource planning) systems and solutions to change from end to end.
“They just need to know what are the solutions they need to implement to grow their sales. That should be the objective, not to digitalise for the sake of digitalisation – they need to digitalise for sales,” she said.
Ng explained that enterprises that mostly operate their business offline faced difficulties in keeping track of their stock as the process was often done manually.
By adding an online element, namely through its software, it will enhance and simplify clients’ stock management process. Moreover, the data captured will alert its clients to replenish inventory as well as provide insights such as stock recommendation, based on customer buying trends.
Haslinda said, “85% of transactions still happen offline. For the past six years, we have been trying to capture and digitalise offline data to online, to have better insights. Previously, there were only 50% online purchase transactions between business to business. We believe that we have reached the midpoint of the mass numbers, data points for us to really come up with quality insights for retailers and suppliers.”
To date, Borong offers three products, namely “marketplace”, “direct” and “credit”.
“’Marketplace’ serves mum-and-pop shops or retailers, acting as a smart product recommendation platform.
“‘Direct’ services sup-pliers to provide them with the right tools to serve retailers or mom-and-pop stores in an optimised way, while ‘credit’ involves our company working together with financial institutions to provide tailored SME financing products to all businesses on our platform,” said Ng.
The majority of its clientele are made up of micro, small and medium enterprises, followed by a small number of well-known brands.
On emerging trends, Ng saw more demand for local products and reckoned that Malaysians are looking into local products as a cheaper alternative and also to support local brands.
“Local brands which tend to be more expensive are more popular within metropolitan areas like Kuala Lumpur, in Penang, Johor and Selangor ... those regions, we see a growing trend mainly because the spending power is higher, while customers in regions with lower (spending power seek) cheaper options,” she said.
Ng said the company is not planning to expand beyond the markets it operates for the time being and will focus on enhancing values and technology this year.
“We want to focus on how we can help to optimise and create more value first within those three countries that we operate in. Once we’re able to do so, then we will expand to other countries.
“It will take probably 12 to 18 months, mainly due to economical shift changes. In the next few years, Southeast Asia has been predicted as a region that would be experiencing global recession.
“We want to prepare all these businesses to be ready and it will be our main priority,” she added.
If an op-portunity for expansion arises, it will target Thai-land, Vietnam or the Philippines.
Ng said the bulk of its annual capex and opex will go into investing to advance its artificial intelligence technology which it incorporates in its system to improve its existing software to make it smarter by working together with the right partners.
Haslinda remarked that the company aims to be data and insight driven, through enhancing the values via captured data.
“Even this year, we discovered a lot of pain points from users, (which we need to fix). There will be more initiatives to capture more data and to process the data to provide more valuable insights for businesses,” she said.
Ng said that most of its clients are from the fast-moving consumer goods, food and beverage as well as machinery, repairs and offices industry.
Moving forward, Macro Tech Ventures is looking to potentially enter into the automotive space, due to the demand from independent car workshops which face the same issues as its MSME clients.
Source:
The Sun Daily
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