• About
  • Advertise
  • Careers
  • Contact Us
Sunday, June 22, 2025
  • Login
No Result
View All Result
NEWSLETTER
Tech | Business | Economy
  • News
  • Tech
    • DisruptiveTECH
    • ConsumerTech
    • How To
    • TechTAINMENT
  • Business
    • Telecoms
    • Mobility
    • Environment
    • Travel
    • StartUPs
      • Chidiverse
    • TE Insights
    • Security
  • Partners
  • Economy
    • Finance
    • Fintech
    • Digital Assets
    • Personal Finance
    • Insurance
  • Features
    • IndustryINFLUENCERS
    • Guest Writer
    • EventDIARY
    • Editorial
    • Appointment
  • TECHECONOMY TV
  • Apply
  • TBS
  • BusinesSENSE For SMEs
  • Chidiverse
  • News
  • Tech
    • DisruptiveTECH
    • ConsumerTech
    • How To
    • TechTAINMENT
  • Business
    • Telecoms
    • Mobility
    • Environment
    • Travel
    • StartUPs
      • Chidiverse
    • TE Insights
    • Security
  • Partners
  • Economy
    • Finance
    • Fintech
    • Digital Assets
    • Personal Finance
    • Insurance
  • Features
    • IndustryINFLUENCERS
    • Guest Writer
    • EventDIARY
    • Editorial
    • Appointment
  • TECHECONOMY TV
  • Apply
  • TBS
  • BusinesSENSE For SMEs
  • Chidiverse
No Result
View All Result
Tech | Business | Economy
No Result
View All Result
ADVERTISEMENT
Home News

The Hidden Cost of Cheap Deals: How Non-Resident E-Commerce Platforms Are Hurting Nigeria’s Economy

OLUWASEUN OLAHIDE: The infiltration of the market with ultra-cheap imports, often of questionable quality marketed by some ecommerce platforms means that SMEs who are already struggling with profitability, will bear the brunt.

by Techeconomy
February 28, 2025
in News
0
Hidden costs of ecommerce cheap deals
How cheap are the cheap deals?

How cheap are the cheap deals?

UBA
Advertisements

In recent years, Nigeria has witnessed an influx of international e-commerce platforms like Alibaba, Aliexpress and the most recent which made its debut in the country some months ago – Temu.

These platforms usually boast an extensive catalogue of products and the lowest of prices. At first glance, this seems like a win for the average consumer, especially with the current rise in inflation, but beneath the surface, these digital platforms pose a serious threat to our economy, local businesses, and long-term economic sustainability.

The sudden influx of these platforms is somewhat suspicious especially as they do not have any offices/representation in the country.

This means aside from collecting money from Nigerians, they have no substantial contribution to the economy via taxes, job creation etc.

The growing trend of these companies expanding into new markets, especially in developing nations like ours, as existing ones become less accessible, is concerning.

For instance, Temu‘s entry into Nigeria aligned with mounting challenges faced by its parent company, PDD Holdings, in international markets.

Vietnam issued a threat to ban the platform until it registers with local authorities. The app was also removed from major stores in Indonesia to protect domestic retailers.

Additionally, the company has faced lawsuits for violating customer privacy, allegedly using its e-commerce platform to acquire and sell user data.

Another lawsuit was issued against the company for sending marketing texts to people on the National Do Not Call list.

With all of these, one could conclude that the company is only trying to move to more lenient markets like Nigeria where they can be less accountable, and they would be right.

After all, unlike homegrown platforms such as Jumia, Konga, and Glovo, which invest in local supply chains, create jobs, and contribute taxes, companies like Temu operate with minimal local engagement.

So, what are the results of the infiltration of these foreign e-commerce platforms in Nigeria?

The Silent Strangulation of Nigerian SMEs

From rising production costs to unpredictable government policies, running a business in this economy is already a Herculean task.

The infiltration of the market with these ultra-cheap imports, often of questionable quality marketed by these platforms means that small and medium-sized enterprises (SMEs) who are already struggling with profitability, will bear the brunt.

SMEs and sustainability | National Debts - AdobeStock
Advertisements
MTN ADS
SMEs and sustainability (IMAGE: AdobeStock)

Local businesses will not be able to compete with products priced far below market rates, especially when those prices are backed by massive tariffs.

The result? Shrinking profit margins, declining local production, and, ultimately, job losses. The irony is painful. While we celebrate the convenience of these platforms, we might, in fact, be funding the slow death of our own economy.

Hidden Cost of Cheap Deals: A Digital Economy That Doesn’t Benefit Nigerians

The Nigerian government has been vocal about its push for a digital economy, but what good is it if the wealth it generates never stays within our borders?

Non-resident e-commerce platforms enjoy free rein, making money off Nigerians without contributing meaningfully to Nigeria’s economy; isn’t that a major hidden cost of cheap deals?

This leaves the government with fewer resources to invest in infrastructure, social services, and local business support.

Meanwhile, resident e-commerce companies like Konga, Glovo, and Jumia, despite facing their own challenges, play by the rules.

They hire Nigerians, collaborate with local vendors, and pay taxes. These companies understand the nuances of our economy and strive to work within its realities, rather than exploit them.

The Case for Protecting the economy

Other nations fiercely protect their local industries. Why should Nigeria be any different?

We must rethink our policies to ensure that companies benefiting from Nigerian consumers also contribute to Nigeria’s economy.

This includes enforcing fair taxation on digital commerce, strengthening local manufacturing, and incentivizing consumers to support homegrown businesses to achieve long-term economic sustainability.

*Oluwaseun Olajide, a senior communications expert writes from Lagos

Loading

0Shares
Tags: AlibabaAliExpressGlovohidden cost of cheap dealsjumiaKongaTemu
Techeconomy

Techeconomy

Next Post
e-commerce and Nigeria's informal sector | Sunil Natraj

The Next Frontier: How E-commerce is Reshaping Nigeria’s Informal Economy

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Recommended

Central Bank - CBN increases fx for cargo clearance - dollar, auctions

CBN Reacts to Alleged Plan to Convert $30bln in Domiciliary Accounts to Naira

1 year ago

Over 360 African Entrepreneurs to Benefit from Alibaba Netpreneur Training program

3 years ago

Popular News

    Connect with us

    • About
    • Advertise
    • Careers
    • Contact Us

    © 2025 TECHECONOMY.

    No Result
    View All Result
    • News
    • Tech
      • DisruptiveTECH
      • ConsumerTech
      • How To
      • TechTAINMENT
    • Business
      • Telecoms
      • Mobility
      • Environment
      • Travel
      • StartUPs
        • Chidiverse
      • TE Insights
      • Security
    • Partners
    • Economy
      • Finance
      • Fintech
      • Digital Assets
      • Personal Finance
      • Insurance
    • Features
      • IndustryINFLUENCERS
      • Guest Writer
      • EventDIARY
      • Editorial
      • Appointment
    • TECHECONOMY TV
    • Apply
    • TBS
    • BusinesSENSE For SMEs

    © 2025 TECHECONOMY.

    Welcome Back!

    Login to your account below

    Forgotten Password?

    Retrieve your password

    Please enter your username or email address to reset your password.

    Log In
    Translate »
    This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.