How to sell cakes (and make money) during a pandemic: Making the most of Malaysia's digital opportunities

Syed Jaymal Zahiid
·6-min read
Jessica Ting, who founded Miss Shortcakes, said nearly all of its sales come from online orders. — Picture courtesy of Jessica Ting
Jessica Ting, who founded Miss Shortcakes, said nearly all of its sales come from online orders. — Picture courtesy of Jessica Ting

KUALA LUMPUR, Feb 18 — Jessica Ting Teik Giong’s cake business “Miss Shortcakes,” once small, was booming. Since returning from Sydney, Australia in 2008, the orders for her fluffy delectables grew exponentially each year.

Ting, 44, then hired more workers, engaged more suppliers and expanded her menu. Until 2018, all of her sales were done online.

Today, while Miss Shortcakes operates from a physical store in Ampang, nearly all its sales come from online orders. She grew her customer base mostly by advertising on free social media applications like Facebook and Instagram. It worked and her business quickly boomed.

“I became very popular, very fast,” she recalled.

“And soon I started receiving messages from all corners of the globe, and the orders kept pouring in and I also received invitations to teach overseas, as far as New York!”

But Ting wouldn’t say her story was unique or was the stuff of fairy tales. Miss Shortcakes, despite growing in popularity, is still very much a small enterprise trying to make it in a highly competitive market, which she suggested hasn’t been easy.

Yet her experience offers millions of other aspiring entrepreneurs a glimpse of what the digital economy can offer. Connectivity has opened up vast opportunities even for the tiniest of businesses, who can now leverage on cheap technology to market their products to a global market.

A McKinsey Global Institute (MGI) estimate in 2019 put Asia’s digital economy at more than 50 per cent of global GDP by 2040, and would account for 40 per cent of consumption.

The South-east Asian digital economy alone was valued at more than RM400 billion in 2019, while Malaysia’s e-commerce was valued at RM16 billion the same year.

The engine of this growing economy is cheap and fast internet, which has made trade seamless. A business no longer requires a physical shop to sell a product and can connect directly with customers in the hundreds of thousands, locally and internationally, all simultaneously within the span of seconds.

Malaysia has one of the highest connectivity rates in the region, at over 90 per cent and a mobile cellular penetration of more than 130 per cent in 2019, according to government estimates. Mobile broadband use is also high in cities and towns, both at 80 per cent.

Policy makers said the rate of Internet penetration makes Malaysia a huge potential market for e-commerce, and the government has plans to grow it further with hopes to turn the country into a regional powerhouse.

Various policies and incentives have been put in place to achieve that goal, including grants and training programmes. But the government has said getting businesses, especially small and medium enterprises, to make that digitalisation shift has not been easy.

What is keeping them from making that leap is unclear, but organisations like the World Bank suggested that knowledge gap and costs could be among the factors.

Survival

But that sentiment changed abruptly in 2020 when a coronavirus pandemic sent the world plunging into one of its worst crises. Smaller businesses in particular were suddenly faced with a life-and-death situation, their livelihoods hanging by a thread as the virus forced public health authorities to lock down cities and towns, causing nearly all economic activities to halt.

Only businesses with primarily online operations were spared. Running virtually meant they could avoid physical human contact while still delivering goods and services, helping them stay afloat throughout the crisis.

Those without an online presence took the lesson hard. Digitalisation was no longer just an optional approach to boost profits, but very much a necessity to survive.

Axiata Enterprise chief executive Gopi Kurup said its own survey showed a seismic shift in attitude towards digitalisation last year. Between 2015 and 2019, only half of respondents felt digital technology was relevant and helpful to their businesses. By 2020, it was 80 per cent.

“In 2020, we did not do a comprehensive one, but sort of a dipstick study and boy did that change a lot,” Gopi told Malay Mail.

Gopi was interviewed as the government prepares to launch this Friday a new national blueprint to chart the path for Malaysia’s digital economy.

On Friday, Prime Minister Tan Sri Muhyiddin Yassin is set to launch MyDIGITAL initiative and the Malaysia Digital Economy Blueprint.

Telecommunication companies like Celcom and Digi are trying hard to get companies still reeling from the effects of the Covid-19 pandemic to get back on their feet, by offering services to help SMEs digitise their operations.

These services come in affordable packages complete with the necessary software and hardware, as well as basic training to help staff familiarise themselves with the tools.

“We call it the SME package,” Gopi said, adding that the service is meant to ease transition from analogue to digital, and with the lowest cost possible.

Its competitor, Digi, now offers innovative solutions it said can help SMEs increase productivity and simplify human resource management, ultimately aiding businesses to become more efficient and cost effective.

“We believe this is where we are well placed to facilitate the acceleration of our country’s digital agenda, by digitalising SMEs, supporting them in achieving long-term growth, and in turn to positively impact the country’s economy,” said Albern Murty, the company’s CEO.

Huge potential

In its assessment of Malaysia’s digital economy, the World Bank said there is huge potential for local businesses to leverage on existing technology like the internet, smartphones, Big Data, and the Internet of things, to help them be more innovative in finding solutions.

The adoption of these technologies also provides businesses with important data that can help them make better decisions, become more efficient and lower costs. Then there is potential for the economy to create new businesses, complement existing ones and ultimately create more jobs.

But there are still challenges that need to be addressed, the bank noted. For example, Malaysia still trails high-income countries in digital adoption, particularly in the business sector.

“Despite recent growth, only 61 per cent of business establishments are connected to the Internet, 46 per cent have fixed broadband, and 28 per cent have a web presence of some kind,” the bank’s report said.

“These rates are low compared to the EU average of 96 per cent of business enterprises connected to the Internet, 95 per cent with broadband, and 75 per cent with a website.”

Still, it noted Malaysia as a highly conducive ecosystem for digital entrepreneurship, pointing to high-profile successes like Grab, iflix and Fave.

And Ting and her business Miss Shortcakes is but one of many success stories that suggest people can or are already thriving in this ecosystem.

“We send our cakes and donuts as far as Klang and Shah Alam. So our customer reach is very good.”

Watch the virtual live broadcast of MyDIGITAL & Malaysia Digital Economy Blueprint from Kuala Lumpur Convention Centre, Friday, February 19, 2021, 9am on TV1, TV3, Awani, Bernama TV and www.epu.gov.my.

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