A Conceptual Framework for Digitalising Microenterprises to Cope with the COVID-19 Pandemic

Abstract

Since the onset of the COVID-19 pandemic, underprivileged entrepreneurs have been experiencing extensive hardship and economic vulnerability. They face financial problems because of irregular business operations and shirking income opportunities. They are increasingly relying on government handouts and subsidies. Several studies suggest that the digitalisation of business is a viable way to keep businesses remaining operational during the pandemic. However, there is a significant lack of research on how microenterprises can be shifted to the digital platform to harness regular business activities and cope with this pandemic situation. Based on the review of the current literature, this paper offers a conceptual framework for the digitalisation of micro-enterprises from a Malaysian standpoint. This framework comprises four major elements of the business value chain: inbound logistics, outbound logistics, operations, and marketing & sales. It also projects light on the efficiency and suitability of digitalised micro-ventures. Based on the logical reasoning, it can be concluded that the digitalisation of micro-businesses would reduce poverty by creating income opportunities for the underprivileged micro-entrepreneurs. Poor entrepreneurs could expand the business to a broader market segment and thus, gain higher benefits. Proper IT infrastructure, technology transfer, online-market places, and an efficient electronic financial transaction system are essential to building a comprehensive digital system for micro-enterprises. In this regard, government intervention can play a significant role in making it happen. Expectedly, this paper will open windows for further research while extending pieces of suggestion to policymakers.