E-imports squeeze local traders

 

Global shopping: Consumers are increasingly buying all sorts of items directly from overseas sellers as seen in this picture taken in Shah Alam, Selangor. — RAJA FAISAL HISHAN/The Star

PETALING JAYA: Ordering directly from overseas has never been easier. Drawn by rock-bottom prices, doorstep delivery and automatic consolidated shipping, Malaysians are flocking to cross-border e-commerce giants for everything from gadgets to sofas.

The surge of platforms like Temu and Pinduoduo is rewriting consumer habits and squeezing domestic traders.

Now local retailers are sounding the alarm, demanding government intervention to level the playing field before they are priced out entirely.

Malaysia Retail Chain Association (MRCA) president Datuk Liew Bin said large-scale overseas platforms are creating an uneven playing field for local retailers and small and medium enterprises (SMEs).

“The question is how local businesses can compete when overseas platforms can sell directly to consumers at such low prices. Without proper measures, SMEs will die standing,” he said when contacted.

Official Department of Statistics Malaysia (DOSM) data underlines this digital shift. E-commerce transaction income reached RM1.288 trillion in 2024, an increase of 8.8% from the previous year, reflecting the growing adoption of digital commerce.

The shift has been underpinned by widespread Internet connectivity.

DOSM reported that 97.1% of Malaysian households had Internet access in 2025, while 98.3% of individuals were Internet users, providing a strong foundation for the continued growth of online shopping and digital transactions.

The digital economy has also continued to expand since the Covid-19 pandemic accelerated the adoption of e-commerce.

DOSM data shows e-commerce revenue for the first nine months of 2025 edging up 1.3% to RM937.5bil, while online spending surged 7.5%, climbing from RM531.6bil to RM571.4bil compared to the previous year.

Liew called for a fairer regulatory framework, urging the government to introduce stricter safeguards and mandatory product screening to level the playing field for domestic traders.

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He highlighted extreme price undercutting as the primary threat, citing a pair of earphones priced at RM50 in a local shop that sells for just RM2.30 – doorstep delivery included – on Pinduoduo.

“They sell furniture, electronic items or even coffins and other products that can be sent directly to customers’ homes,” Liew said.

“Of course, consumers must be selective when shopping on these platforms.

“Cheap does not always mean good quality,” he added.

Liew noted a rapid surge in imports from China, with roughly 150 containers arriving daily to meet growing demand for bargain goods.

Electronics, cosmetics, and general retail and wholesale trade are bearing the brunt of the influx.

SME Association of Malaysia president Dr Chin Chee Seong echoed these concerns, warning that domestic small businesses face mounting strain.

“These platforms can offer products at prices that many local businesses simply cannot match because of their massive economies of scale, highly efficient supply chains and aggressive pricing strategies,” Chin said.

To survive, he urged local SMEs to capitalise on their strengths – focusing on product authenticity, superior quality, rapid local delivery and dependable after-sales support.

Rather than restricting free trade, Chin argued that the government must enforce a level playing field by subjecting cross-border giants to local tax, customs and regulatory rules.

“This would promote fair competition, protect tax revenue and prevent Malaysian SMEs from being placed at a disadvantage,” he added.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said technological advances have intensified competition, giving consumers more choices and lower prices.

High demand: Hundreds of containers stacked up at a logistics warehouse in Northport, Port Klang, as Malaysians flock to e-commerce platforms. — KK SHAM/The Star

“Consumers benefit from greater choice and improved purchasing power, but intense competition can marginalise local businesses that lack the scale and technology to compete.

“The challenge for policymakers is to strike a balance between preserving competition and ensuring foreign platforms comply with the same tax, regulatory and product standards as local businesses,” he said.

Federation of Malaysian Consumers Associations (Fomca) chief executive officer T. Saravanan said that while lower prices and heightened competition benefit shoppers, abnormally cheap goods should serve as a red flag regarding safety, quality and regulatory compliance.

He said both Fomca and the National Consumer Complaints Centre have logged a steady stream of grievances involving online buys, particularly faulty electrical appliances, questionable cosmetics and items that fail to match their descriptions.

While these complaints span various platforms, Saravanan stressed that the rapid expansion of cross-border marketplaces makes strict oversight of regulated goods essential.

“Online marketplaces must verify sellers, remove non-compliant listings promptly, respond effectively to complaints and cooperate with Malaysian regulators,” he said, insisting that foreign merchants adhere to the same standards as local sellers. - Star