Steve Sy is the Founder and CEO of Great Deals E-Commerce Corporation, a pioneer and currently the Philippines’ largest provider of end-to-end ecommerce solutions to over 300 of the biggest manufacturers and country distributors in the Philippines. Great Deals was recently ranked by Inquirer and Statista as the fastest growing company in the Philippines, and by Financial Times as the fastest growing company in Asia Pacific. Founded in 2014, Sy is one of the eight winners in the 2nd Mansmith Innovation Awards. He, along with co-awardees, will be speaking at the 2nd Mansmith Innovation Summit and Awards, scheduled in the afternoon of April 26-27, 2022.
Q1: You started e-commerce by selling power banks and virgin coconut oil but shifted to branded products as a business model. What is the trigger behind this shift?
A1: I saw both platforms Lazada and Shopee are bringing in more cross border merchants that greatly affected the importation of goods from China, this drove efficiencies in cross border selling and made competition a lot tougher.
So, I chose to pivot my business model into catering multinational companies that will augment a lot of these companies for my business to continue to thrive.
Q2: Can you describe the services offered by Great Deals? Which were the originals? Which came after the business model change and why? Which unique services are you proudest of?
A2: When I started my business, everything was original in the sense that I was offering an end-to-end solution to the E-commerce space. The services that we offer are content creation from photoshoot, copywriting, online shop creation, campaign coordination and activation, chat support, warehousing and fulfillment, and business intelligence. There was not much of a change because we are already offering end-to-end. The peak scaling of our fulfillment would be one of my key unique services. In the Philippines, our capabilities in terms of fulfillment matched that of the platforms. We have the second largest fulfillment center in the Philippines with 40,000 sqm.
Q3: You have a built-to-last, positive cashflow mindset, rather than following the usual business model of other startups, which is to build-and-sell while operating at a loss. What was the insight behind this paradigm?
A3: At the start, my mindset was just to run my business. I never thought of selling my company. Founding Great Deals was more like having a business, so I need to have a sustainable cash flow to be able to grow and outgrow my business. Having that mindset, I think it paid off handsomely.
I remember the story that one of the National Sales Manager of Reckitt Benckiser was in my office last 2017. He told me, “Steve, don’t you know that your business can be sold or bought?”. That was the first time that I had this realization that “Oh, I can offer this as an investment to investors”. But even on the onset, it was really “Built to Last”.
Q4: Many companies have since created their own online ordering system. Many also have their distribution centers all over the Philippines. What’s the business case to appoint or maintain an e-commerce distributor like Great Deals rather than start their own initiative in-house or hire an experienced e-commerce expert?
A4: In terms of online distribution or E-commerce, it is quite different compared to a typical offline distributorship. We’re dealing with B2C (Business to Consumers) while most of the distributors are dealing with B2B (Business to Business). The intricacy of running a business online is different from running offline business that’s why we thrive in this new industry. If it’s that easy to transition, most probably a lot of offline distributors will just transfer online. But it’s a different kind of core competence, different kind of talent needed, you need to have digital savvy people. Creating demand online, having the right mindset in dealing with the digital consumers is really different from an offline perspective.
Brands choose Great Deals because we do have the talent, and the agility to thrive in an ever-changing environment. On top of that we have a Great Deals Academy that helps all teams know more about E-commerce. We’re proud to produce a lot of E-commerce experts here in the Philippines through our Great Deals Academy.
As you know, China is 5-6years more advanced than us and there are a lot of E-Distributors and E-Commerce enablers, and those players are all part of that one ecosystem. It’s more expensive to do in-house and you cannot really scale. The economies of scale that we have for Great Deals is different. It’s better for a company to outsource into an E-commerce enabler.
Q5: What have you discovered about the different market segments buying through e-commerce?
A5: There are a lot of different market segments. Most people buying on the platforms are quite price sensitive. People tend to buy online simply because of price and convenience.
Q6: How do you plan to continue to innovate Great Deals?
A6: There are a lot of ways, one is in the digital marketing side. We are increasing our capabilities in demand creation through the digital marketing efforts. There are a lot of latest trends like live streaming, paid search, google ads, social commerce that we are into to develop our capabilities in demand creation. Another thing that we are innovating soon is local regionalization. We are setting up a network of fulfilment centers across the nation. With this, more economical shipping costs to end consumers will be available. We are also building an automated fulfillment center that will be able to fulfill millions of orders a day to cater to more Filipino customers that will be buying online.
Josiah Go is Chairman and Chief Innovation Strategist of Mansmith and Fielders Inc. The 2nd Mansmith Innovation Summit and Awards on April 26-27, 2022 is free to attend through registration in www.mansmithinnovation.com. Bring your entire team.