Online shopping

Traditional clothing sector struggles to keep pace with online shopping: Jordan

AMMAN — Clothing stores across the Kingdom are on edge, with tens of thousands of employees losing their jobs due to the rise in online shopping and the impact of other crises, industry officials say.

Asad Qawasmi, the representative of the garment, footwear and jewelery sector at the Jordan Chamber of Commerce (JCC), told the Jordan Times that the local garment sector was in “urgent need” of effective solutions to revive the sector and support business owners.

Textiles, Garments and Footwear Union President Sultan Allan told The Jordan Times on Sunday that the sector currently employs 69,000 people.

“The business downturn has resulted in the loss of 82,000 employees,” Allan added.

Almost every employee is the primary supplier to their household, Qawasmi said.

The JCC representative said the increase in online shopping is taking a heavy toll on traditional store owners, adding that ongoing store closures and rising unemployment are the result of unregulated online commerce, said said Qawasmi.

He said parcels ordered online are exempt from traditional shopping standards and regulations. “Online merchants pass goods through customs as personal-use items,” Qawasmi added.

However, Qawasmi said online merchants stock these goods and sell them at affordable prices, “resulting in unfair competition between traditional clothing merchants and online merchants.”

“Taxes and fees need to be unified between e-commerce and traditional shopping,” Allan said.

However, some online business owners disagree with Allan’s assertion.

“We pay shipping costs, freight costs, customs costs as well as marketing costs,” said online business owner Shatha Mustafa.

Mustafa claimed that there are often hidden fees for e-commerce businesses. “We pay for online advertisements, we pay intermediaries in other countries, we now pay an annual fee to the Ministry of Commerce and we also have to report our sales to the Tax Department,” Mustafa said.

She added that for a business to succeed, it must present a solution to a problem. “Traffic, rising temperatures, misleading advertising, as well as COVID-19 have each contributed to slowing business in the traditional clothing sector,” Mustafa said.

However, Mustafa believes traditional traders have not improved their business models. “Store owners are using the same business models that have existed in the market for decades,” Mustafa said.

“Our competitive advantage is that we understand consumer demands,” Mustafa said.

“People feel safe shopping online. They know they will get the service they want, as well as the customer service they expect,” Dima Qudah, owner of an online clothing business, told The Jordan Times.

Qudah said the competitive advantage of online businesses is customer service, rather than affordability.

Qudah added that people tend to shop online because they will get the service they paid for. “One bad review is enough to destroy an online business. The service a customer gets is what matters most to them in the end,” Qudah remarked.

“Traditional stores need to keep up with global trends,” Qudah concluded.

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