KUALA LUMPUR: MALAYSIA is fast establishing itself as an exporter of lifestyle products.
Malaysia External Trade Development Corporation (Matrade) has recorded a steady export growth in these product categories, such as fashion, textile, clothing and footwear; jewellery; gifts and premium; cosmetics, beauty care and toiletries; and furniture.
The agency said exports of lifestyle products, also known as “soft exports”, had been gaining momentum in recent years.
“Soft exports rose 13.2 per cent to RM36.91 billion last year from RM32.61 billion the previous year.
“In terms of growth, gifts and premium posted the highest growth at 20.4 per cent, followed by cosmetics and toiletries (18 per cent), furniture (14.1 per cent), jewellery (13.7 per cent) and fashion, textile, clothing and footwear (9.1 per cent).
“For the first six months of this year, soft exports continue to register steady growth of 10 per cent to RM18.74 billion compared with RM17.11 billion in the same period last year,” it said in an email.
Seeing this upward trend, Matrade chief executive officer Datuk Dzulkifli Mahmud told Business Times it was encouraging local players in the soft exports sector to register as members as this would enable them to access a databank of market and trade information as well as incentives.
“Matrade does offer incentives to help Malaysian companies sustain and enhance their export business. These incentives cover financial and non-financial aspects. For financial assistance, Matrade offers market development grant (MDG), services export fund (SEF) and eTRADE, a programme that extends subsidised participation fee in selected e-marketplaces.
“MDG is a scheme to assist small and medium enterprises (SMEs), service providers, trade and industry associations and chambers of commerce and professional bodies in undertaking export promotional activities.
“Companies can apply for a reimbursable grant on the eligible export promotional activities.”
The SEF is for Malaysian service providers to expand into the international market. The assistance is the form of reimbursable grants and soft loans. The grants and soft loans disbursed can go up to a total of RM5 million per company.
Through the eTRADE programme, SMEs may enjoy a one-off incentive to be listed in one approved e-marketplace or training for listing by
e-marketplace. They are also given the opportunity to promote their online presence in e-marketplaces such as Amazon, Alibaba or eBay.
For non-financial incentives, Matrade organises a series of capacity-building programmes to equip exporters with knowledge and skills.
They include briefings and trade talks on market opportunities, workshops on certifications and standardisation as well as training on exporting products, among many others.
For soft exports, the United States tops the list of major markets with RM5.68 billion worth of exports last year, followed by the United Arab Emirates (RM5.14 billion), Singapore (RM4.96 billion), Japan (RM2.56 billion), Australia (RM1.56 billion), China (RM1.16 billion), Indonesia (RM940 million), Turkey (RM740 million), South Korea (RM680 million) and Thailand (RM640 million).
These top 10 markets accounted for 65 per cent of Malaysia’s total exports of lifestyle goods.
Additionally, as part of the strategies to sustain growth, soft exports are diversified to other new and emerging markets such as Kazakhstan, Senegal, Poland, Algeria and Hungary.
Small but promising markets in the Caribbean, Oceania and Central America are also being explored.
According to Matrade, although Malaysia’s lifestyle industry players may not be able to compete on pricing, they certainly are able to produce high-quality products.
“They are capable of designing and producing high-quality finished products and because of this reputation, some of our enterprises have been given the recognition to manufacture for established international brands as an original equipment manufacturer (OEM).
“Some of the manufacturers have managed to move up the value chain to develop their own brand products using automation and strengthening the overall linkages. Basically, the industry players have evolved from OEMs to original design manufacturers and own brand manufacturers,” it said.
Matrade said it would continue to execute programmes to ramp up soft exports as these served as platforms to assist local entrepreneurs to venture into the export business or enhance their market share.
“Matrade collaborates with valuable partners from public and private sectors as well as non-governmental organisations and social enterprises. Engagement, support and feedback with and from these partners are essential to enable Matrade to carry out programmes effectively and achieve the desired outcome,” said Dzulkifli.
He said the programmes encompassed capacity-building, promotion and marketing.
Capacity-building takes care of the necessary skills and knowledge that the lifestyle entrepreneurs should have in preparing themselves for the export business.
As for international promotion and marketing, Matrade organises the participation of local enterprises in well-known international lifestyle events and export acceleration missions.
Business-matching sessions with potential buyers and importers are held during these sessions.
Dzulkifli said local entrepreneurs were also leveraging on e-commerce to accelerate soft exports.
Matrade has an online business programme called e-Trade to encourage entrepreneurs to promote and sell their products in major e-commerce global marketplaces such as Alibaba, Amazon and eBay.
Matrade also has its own event to promote soft exports — the annual International Trade Malaysia and Malaysia Fashion Week — which will be held from November 2-5 at the Matrade Exhibition and Convention Centre, here.