Kota Kinabalu: Sabah Small and Medium Enterprise Association President Dr Tan Hui San said local SMEs are facing mounting pressure from cross border e-commerce platforms, and called on the government to introduce fair regulatory measures to protect the local business environment.
She said the association had received numerous reports from members of a decline in business, particularly among those dealing in consumer goods, household items, hardware, electronics, beauty products and daily necessities.
“These platforms operate on a manufacturer-to- consumer business model, allowing consumers to buy directly from overseas manufacturers. This bypasses importers, wholesalers and retailers, so selling prices are often significantly lower than in the local market,” she said in a statement, Tuesday.
She said local businesses had to bear costs such as rentals, manpower, warehousing, logistics and taxes, while many cross border sellers did not face the same cost structures, creating an uneven playing field.
Drawing a parallel with the United States, she said a similar shift there had weakened the intermediary supply chain and pushed many traditional traders and retailers out of the market.
“We are concerned Sabah is facing a similar situation. It is not just retailers who are affected. Logistics, wholesale, warehousing and related service industries could also face cascading impacts,” she said.
She said the association was not opposed to e-commerce, but urged the federal and state governments to review existing regulatory frameworks, strengthen oversight of import and tax mechanisms, support local SMEs in digital transformation, and engage in dialogue with industry stakeholders.
“SMEs remain a vital pillar of Sabah’s economy. If local businesses continue to decline, it will affect the entire economic ecosystem, including employment and the investment climate,” she said.
She called on the government to initiate dialogue with the industry promptly and formulate policies that balance consumer interests with the competitiveness of local enterprises.
