Surfing through compliance waves

The 'new normal' brings enormous new opportunities for e-commerce businesses. MBG's ECIC makes it easier for you to ride through it

Covid-19 was a catalyst and accelerator for e-commerce in the region. Its lockdowns, social distancing and work from home norms drove a fundamental change in consumer attitudes and behaviour, making online shopping everyday behaviour across society. 

The GCC e-commerce market will double to $50 billion between 2020-25, an annual growth of 16 per cent per annum. One-third of that, or 5 per cent per annum, is incremental growth due to the pandemic. The UAE leads in absolute and per capita market size as well as in penetration, while Saudi Arabia is a close second on market size and growing faster than the former. 

High internet penetration, strong infrastructure, a young population, and government initiatives in the region, and improved online security and new payment formats globally, meant e-commerce grew rapidly in the pre-pandemic years too. Now, the market has expanded in breadth. For example, sales growth in traditionally brick-and-mortar categories like groceries, or in card and other non-cash on delivery payments.  

The ecosystem now comprises large pure-play marketplaces, omnichannel click-and-mortar e-stores, specialist niche e-tailers, delivery aggregators, and manufacturers' Direct to Consumer (D2C) plays. Startups continue to mushroom. And e-commerce still attracts investors' attention and funding. GCC governments have supported the sector through many enablers and incentives. 

Naresh Manchanda, Partner

MBG Corporate Services

Naresh Manchanda, Partner, MBG Corporate Services says, "Cyber risk has more than quadrupled since 2002 and tripled since 2013. Cyber Insecurity can be prevented proactively through integrated compliance."

The new normal also means new challenges 

However, it is not easy for individual businesses. This is a rapidly crowding space dominated by one or two giants with deep pockets. Thin margins, high operating costs of fulfilment, marketing, etc., are driven by ever-inflating customer expectations. Adequate CapEx and working capital flows are essential. Strategic and operational excellence is therefore imperative but hard to sustain. Plus, there are the challenges of setting up, legal and tax, risk management, and so on. 

Given the pressures of rapid changes in technology, consumer behaviour and regulatory environment, these challenges are heightened for e-commerce.  

Help is at hand: Enter ECIC, MBG's e-commerce offering

MBG's E-Commerce Integrated Compliance (ECIC)  has risk advisory, cybersecurity, intelligent automation, legal, tax, unified In-Country Value and audit solutions for both new and existing businesses. Its unique strength derives from a mix of best-in-class technology and regulatory services, the perfect intersection for your e-commerce business, peopled by domain expert leaders.

Key ECIC services include the following: