Traditional clothing sector struggles to keep up with online shopping

AMMAN — Clothing stores in the Kingdom are on edge, with tens of thousands of employees losing their jobs amid the rise of online shopping and the impact of other crises, according to sector representatives. 

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

President of the Textile, Readymade Clothes and Footwear Syndicate Sultan Allan told The Jordan Times on Sunday that the sector currently employs 69,000 workers. 

“Slow business resulted in 82,000 employees losing their jobs,” Allan added.  

Almost every employee is the primary provider for their household, said Qawasmi. 

The JCC representative said the rise online shopping is taking a heavy toll on traditional shop owners, adding that the ongoing shop closures and the growing unemployment is a result of unregulated online trading, said Qawasmi. 

He said that packages ordered online are exempt from the standards and regulations of traditional shopping. “Online traders get the merchandise through customs as personal-use items,” Qawasmi added. 

However, Qawasmi stated that online traders stockpile this merchandise and sell them for affordable prices, “which results in unfair competition between the traditional and the online clothing traders”. 

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

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

“We pay shipping fees, transport fees, customs as well as marketing fees,” said Shatha Mustafa, an online business owner.

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

She added that for any business to thrive, it must present a solution to a problem. “Traffic, rising temperatures, false advertising, as well as COVID-19 each contributed to slowing down of the traditional clothing sector’s business,” said Mustafa. 

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

“Our competitive edge is that we understand consumer’s demands,” Mustafa said.

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

Qudah stated that online businesses’ competitive edge is customer service, rather than affordable prices. 

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

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