In a remarkable turnaround, Kenyan e-commerce start-up Sky Garden has resurrected from the brink of closure, thanks to a strategic Ksh.250 million ($1.6 million) investment by tech credit platform Lipa Later. The acquisition, completed in December 2022, not only breathed new life into Sky Garden but positioned it for ambitious growth, aiming to connect with 100,000 merchants in the coming year.
Lipa Later, a key player in the Buy Now Pay Later (BNPL) service, injected fresh capital into Sky Garden, signaling a significant transformation. The revitalized platform now boasts integrated payment solutions, logistic support, marketing tools, and crucial business insights, aligning itself with the vision of becoming a commerce catalyst for businesses and communities across Africa.
Under the stewardship of Lipa Later, Sky Garden’s enhanced platform offers merchants a comprehensive suite of services, including access to financing, real-time transaction monitoring, direct bill payments, seamless deposits and withdrawals to M-Pesa or bank accounts, and the novel ability to open a bank account. This holistic approach aims to empower merchants, reduce online interactions, and facilitate sales from anywhere at any time.
The synergy between Lipa Later’s BNPL service and Sky Garden’s Amazon-style marketplace sets the stage for a customer-centric approach. Shoppers can now utilize Lipa Later’s flexible and affordable monthly instalment payment plan to purchase items, opening up new avenues for increased sales and customer engagement.
Notably, Sky Garden is expanding its horizons by venturing into social commerce. The platform introduces features that enable shoppers to discover, share, and make purchases directly within their social networks. This strategic move aligns with the evolving landscape of e-commerce, tapping into the power of social connections for both consumers and merchants.
Lipa Later Group CEO, Eric Muli, emphasized the group’s broader vision, stating, “Our group vision is to be a commerce catalyst for businesses and communities across Africa. We firmly believe that local ownership and operation are essential in understanding the needs of our people, contributing to the prosperity of our nation, and forging a true connection with our community.”
Sky Garden’s success story is particularly poignant considering its near closure in October of the previous year due to insolvency. The startup faced a funding gap in September, despite having raised over $6,000,000 (Ksh.919 million) before the acquisition. Lipa Later’s timely intervention not only saved the venture but propelled it into a phase of expansion and innovation.
Lipa Later’s strategic moves, including securing approval for fundraising in the United States and closing a Ksh.500 million debt issue, demonstrate the platform’s commitment to sustainable growth and financial stability. As one of the first African companies to receive approval from the U.S. Securities and Exchange Commission (SEC), Lipa Later’s success story is intricately woven with Sky Garden’s resurgence, marking a transformative chapter in the landscape of Kenyan e-commerce.
A recent Visa report has shown that the top market contributors to e-commerce in Sub-Saharan Africa (SSA) over the last 3 years were South Africa, Nigeria, and Kenya, with Ghana also showing growth, having replaced Kenya in the top three contributors in 2020. SSA may be one of the smallest regions of e-commerce globally, but it shows steady growth potential. During lockdown, the region saw new e-commerce users rise by 5% when compared to the active base in SSA the previous year.
e-commerce
“The three leading markets in SSA are starting to mature, providing the region with an established foundation and when twinned with the growing penetration of e-commerce, it offers players in the payment space an opportunity they can capitalise on while helping to further accelerate the expansion of e-commerce in the region,” explains Lineshree Moodley, Head of Visa Consulting and Analytics (VCA) in Sub-Saharan Africa.
Visa’s white paper, entitled E-commerce developments across Sub Saharan Africa (SSA), confirmed that, as the world becomes increasingly digital, e-commerce has been driving the acceleration of digital commerce.
It has experienced phenomenal growth rates around the world, and even recent setbacks as a result of the continuing COVID-19 pandemic haven’t stopped its rise. In fact, according to recent GroupM estimates, e-commerce sales are projected to grow to $7-trillion across the globe by 2024.
The Research
Cross-border transactions make up half of all e-commerce transaction volumes
E-commerce is driven by retail goods and professional services
Mobile phones are the main source of digital access
Payment facilitators are a critical catalyst for digital payments
Fraud protection is key to maintaining customer trust
In terms of the merchant categories driving e-commerce, for Kenya and Nigeria, there is a steady dedication to service-based merchants with a strong spread across services categories such as professional services, education, government, and business-to-business merchants.
Top Drivers in E-commerce
In South Africa, professional services and telecom/utilities merchants were the top drivers of e-commerce in 2020. The most important e-commerce enablers – the ability to access financial services, digital payment channels and digital infrastructure – are starting to take hold across SSA.
Although cash may remain the dominant payment instrument in the region, for now, there are signs that this will eventually change.
In Nigeria, for example, cash is still particularly prevalent, while in Kenya mobile money is most popular and many South Africans choose cards as their main payment methods.
The COVID-19 pandemic has pushed consumers towards digital payments in the key e-commerce markets for SSA.
Cash vs. Cashless
At a primary level of cash versus digital payment instruments, there has been a strong move away from the use of cash across the board. This is due to a shift to e-commerce behaviour that is mostly enabled by digital payments and a reduced preference for face-to-face interactions that involve handling common surfaces, such as cash.
When exploring digital payments usage, the use of cards has increased across the continent, with the highest uptick taking place in Kenya. However, the nature of this usage is interesting.
There has been a strong preference for contactless payments, a notable point for enabling safe card payments on delivery, as well as in the use of e-wallet services, as cash is seen as a vector for the virus.
Aldo Laubscher, Country Manager at Visa South Africa says that it is important that e-commerce platforms are designed with end-to-end mobile enablement in mind, and that online payments provide a strong user experience that is secure and appears seamless to the customer, both for local and cross-border transactions.
“Customers in SSA are making use of a wide range of digital payment instruments, so it is becoming increasingly important that e-commerce offers multi and even omnichannel experiences. At Visa, we continue to work with traditional and new financial services companies to develop new products and capabilities that deliver on this.”
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
The Covid-19 pandemic has accelerated the adoption of e-commerce in a way no company could have imagined. In fact, in many instances, it has brought three- to five-year sales projections forward in just a matter of months. Many businesses are already living in the future. A good example is Amazon.com, which has experienced record levels of demand, comparable to a usual Christmas period. Not only has its online retail operation thrived, but its video and Web services have also flourished during the lockdown periods around the world.
Gerrit Smit, head of equity management UK at Stonehage Fleming
Then there are digital payment companies such as PayPal, which has recorded a remarkable increase in transactions across its network. It took on 7.4m new customers in April alone — a 135% increase. Those new customers are doing more transactions than ever and the business is experiencing retention rates to match.
This must be one of the biggest economic shifts in the world for a long time, if not ever. Nor is this trend likely to reverse materially…Visa, too, is benefitting. Quite apart from an increase in online purchases, hygiene-conscious consumers’ reluctance to touch cash has further boosted business. This is a game-changer for all payment companies whose biggest competitor is cash.
E-commerce is perhaps the most striking example of structural shifts in the economy. Since the beginning of Covid-19 alone, e-commerce penetration as a percentage of retail sales in the US has increased in a matter of three months as much as it previously took a decade to achieve. This must be one of the biggest economic shifts in the world for a long time, if not ever. Nor is this trend likely to reverse materially once economies have fully opened and the virus has receded.
Economic shift
With millions of people working and learning from home, consumers have been forced to rely on e-commerce, and have come to understand the benefits of obtaining goods and services through the Internet. These include variety, safety, convenience and certain cost savings.
From an investor’s perspective, the economic shift to online is revitalising important investment opportunities. In addition to large retailers like Amazon and payment systems like PayPal and Visa, technology companies that enable working from home have also benefited. Consider 5G network providers, data and voice providers, cloud services, data handling and office automation services. More time at home has also meant more home cooking, to the benefit of many food and spices companies, as well as an increase in home design and décor products and services as people adapt their homes for new requirements.
Entertainment and streaming services have also benefited from people spending more time at home, as have online exercise offerings. And of course, this has translated into an increased interest in leisure and sports clothing lines.Investors will find no shortage of newly energised investment opportunities. High uncertainty and market volatility, however, will remain a challenge. Good stock selection is as critical as it has ever been. Investors should be very selective with their investments – buying only quality businesses with strong balance sheets.
Gerrit Smit is head of equity management UK at Stonehage Fleming. He manages the Stonehage Fleming Global Best Ideas Equity Fund
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
This is definitely a very promising time for Africa start-ups as investors’ interest in on the upswing. In the last few months, African start-ups have raised close to $1 billion from investors across the world pointing to the belief that Africa is undoubtedly the next big frontier. The latest in the strings of African start-ups that got the attention of investors is the Kenyan based e-commerce company Copia Global which raised $26 million in a Series B round.
Company sources say that the funding round was led by LGT Lightstone, with participation from Perivoli Innovations, Endeavor Catalyst, ELEA and Goodwell Investments. The most attractive factor about Copia Global according to market watchers is different from other e-commerce platforms in that it has a unique business model that effectively combines online and offline experiences, and is focused on low-income and unbanked citizens living in rural areas.
The platform allows customers make purchases on its website through agents scattered across the country who order on their behalf. Copia also allows customers make purchases with USSD technology through feature phones that do not have smart features and internet.
The new funding is coming after a $2 million round from Goodwell Investments in January 2019. Copia will use the new money raised to strengthen operations in Kenya, and expand across East Africa. Sources at Crunchbase say that Copia Global has raised a collective $22 million since 2015, and the recent Series B round brought the total amount raised to $48 million.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
Naspers is having a field day of late. First, it just had its first black woman CEO ever in its 104 years of existence. Again, PayU, Naspers’ global fintech firm has just announced it has entered Southeast Asia — Singapore — following its acquisition of Red Dot Payment.
A Look At The New Move
PayU is the Naspers-owned fintech firm that specializes in emerging markets
The deal is to buy a majority stake in Singapore-based Red Dot Payment.
Naspers is best known for its payments and fintech business in markets like India, Latin America, Africa, and Eastern Europe, but now it will enter Southeast Asia, a market with more than 600 million consumers and rapidly rising internet access.
PayU plans to tap that potential through Red Dot, an eight-year-old startup founded by finance veterans that offers services that include a payment gateway, e-commerce storefronts and online invoicing across Southeast Asia. PayU said it has acquired “a majority stake” in the business. It did not specify the exact size but it did disclose that the deal values Red Dot at $65 million.
It isn’t clear exactly how much Red Dot had raised from investors overall — its Series B was $5.2 million but the value of prior rounds was not disclosed — but its backers include Japan’s GMO, Wavemaker, Skype co-founder Toivo Annus and MDI Ventures. The company said, “the majority” of its investors exited through this transaction, but some stakeholders — including CEO Randy Tan — are keeping shares with a view to a later buyout in full.
The deal is important for PayU, according to CEO Laurent Le Moal, who stressed that the company believes in retaining teams and empowering them through acquisitions, rather than simply buying an asset.
“We have to strike the balance between a solid majority [acquisition] and an opportunity for founders,’’ said Maol in an interview.
PayU plans to put “real investment” into the startup, whilst also integrating its services into its “Hub” of services and tech, a stack that is shared with its mesh of global business and was built from its acquisition of Israel’s Zooz.
PayU’s India business alone is estimated to be worth $2.5 billion, but its overall business is hard to value, but more details will emerge of its global business as Naspers lists select entities through an IPO in Europe. Back to the deal, Tan called it “a marriage made in heaven,” and he also revealed that Red Dot had turned down recent investment and acquisition offers from three other suitors.
“They [PayU] operate globally and have over 300,000 merchants, including Facebook, Google and the kind of clients we aspire to win,” he said.
So why Southeast Asia, and why now?
“We want to build the number one payments company for high-growth markets,” le Moal said. “If you look at what the top 10 economies will be in 2030, half are in Southeast Asia and the rest are growth markets we are already in.”
“We are number one in India, in the biggest markets in Africa, the fastest-growing part of Europe and Latin America, but we have no presence in Southeast Asia,” he continued. “It’s fundamental… you want to go where the consumer growth is.”
That’s supported by a report from Google and Temasek that was issued last year and forecasts that the region’s online spending will more than triple by 2025 to reach $240 billion annually.
The initial focus post-deal is to supercharge the Red Dot business through shared tech, networks, and expertise, but, further down the line, le Moal has a vision of going deeper into fintech and financial services to offer products such as consumer credit, as it has done in India.
Such a product launch isn’t likely to happen for another 12 months at least, the PayU CEO said. Before then, there will be a focus on growing Red Dot’s cross-border trade business and developing synergy with its business in other markets, especially India.
PayU CEO Laurent Le Moal said the company is looking to dominate high-growth markets in Southeast Asia following its acquisition of Red Dot Payment
Le Moal hinted also that PayU has ambitions to be in Japan and Korea, although he conceded that the exact strategy — which could include organic growth — is still to be defined. We can certainly expect to see an uptick from the company in Southeast Asia and the wider Asian continent. “There will be an acceleration of investment and M&A,” le Moal said. “It’s just the beginning for us as PayU and Naspers in the region.”
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Liberia is shooting to loosen up its business environment for investors and businesses. Unlike what used to be the case in the past where all registration of businesses has to be done online, the Liberia Business Registry (LBR) has launched a website which has an online application for effective and efficient service delivery to the business community. The service became effective Wednesday, July 3.
What The Liberian Online Business Registration Looks Like
With the new online platform, the time limit for establishing a business in the country would be significantly reduced.
“People from Pleebo, Nimba, Lofa and all far-to-reach areas will no longer have to commute to Monrovia, and bear the cost of transportation and accommodation just to get registered or obtain Articles of Incorporation, said Mr. Dee, Registrar General of the Liberia Business Registry.
The website also will provide different kinds of corporate registration information and will help taxpayers directly apply for certificates and Articles of Incorporation with a user account, according to Registrar General Samson Dee.
The reform is coming after Liberia’s President George Weah established the “Business Climate Working Group” which informed the establishment of the Website and online Application.
The Challenges Of Setting Up Business In Liberia Is Noted In This Statement From Mr. Dee
“There have been series of challenges, in fact the last rating that came up from the World Bank, said it was taking Liberia 18 days to register a business in the Country and I think we all know that this is highly unfriendly when it comes to the business sector. So, on that basis President George M. Weah, set up a Business Climate Working Group, of which we are member and we were tasked with the singular responsibility to turn the picture around to improve the business climate and ensure that we attract investors from every part of the world,” he said.
“We heard the Registrar General say there are foreign entrepreneurs who may come to Liberia and may like to have information of doing business in the Country, and this development will undoubtedly help in the process.” Acting Commerce and Industry Minister Mr. Wilfred N. Bangura observed.
Under Liberian corporate law, all businesses are required to register or apply for a Business Registration Certificate to authorize doing business or providing services in Liberia.
The Liberia Business Registry (LBR) under the Ministry of Commerce and Industry (MOCI) handles the applications and business registration processes. The fee structure for registration varies depending on whether a business is local, foreign, a sole proprietorship, a partnership, or a corporation. The standard steps to follow in establishing a local business office are noted below:
Reserve a unique company name with LBR: an applicant can do a name search online or at the LBR helpdesk; business names can be reserved for up to 120 days.
Register the company using the registration application form (RF-001), and submit the completed application with the company’s articles of incorporation, proof of identification, empowered person’s or registered agent’s form, incorporator’s form, shares and shareholders’ form, and information for tax authority form.
LBR will review the application package and request a Tax Identification Number (TIN) and bank payment slip (BPS) on behalf of the business in question; all businesses operating in Liberia must have a TIN, which is obtained free of charge from Ministry of Finance and Development Planning.
Once a TIN has been obtained, pay associated business registration fees at the Central Bank of Liberia (CBL)’s window at LBR or use the mobile money payment system; mobile money services are provided by the two leading mobile network operators, Lonestar MTN and Orange Liberia.
Present the proof of payment to the LBR registrar where the process is completed.
The entire process takes one to four weeks. Registration of business is valid for 12 calendar months from the date of registration. Conducting commercial activities in Liberia without being registered will result in penalties. The LBR publishes a fee schedule for new enterprise registrations applicable to different types of legal entities.
All that will now have to be done online with this new move.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Nothing lasts forever, goes the saying. For the Baby Boomers and Generation X who existed without the internet, it was a shock that the traditional, physical retail business model could fade away, to be replaced by the business at the click of a button.
Today, Amazon Effect means that traditional, physical retail shops continue to wind down and call it a quit, giving in to the stiff competition from Amazon, eBay, Alibaba, Jumia and online shops. For emerging markets and developing countries, what remains for these physical shops to be completely rendered to ruins is trust.
Chinese billionaire, Jack Ma, understood this early enough. In 2016, Jack Ma started a revolution he called the ‘New Retail’ that would itself redefine what commerce really means for all of us. Jack Ma is the 21st richest man in the world and the number one richest man in the most populous nation on Earth— China.
He is piercing the heart of commerce and extracting what has fueled commerce over the course of thousands of years ago — human beings. Through new retail trade, he is relaunching the whole idea of technology in commerce and trade itself to the people that originally own them — human beings, consumers.
“Commerce as we know it is changing in front of our eyes. E-commerce” is rapidly evolving into “New Retail.” ,” Ma wrote to Alibaba shareholders in a letter sent ahead of the New York-listed company’s annual shareholders in 2016. ”The boundary between offline and online commerce disappears as we focus on fulfilling the personalized needs of each customer. We anticipate the birth of a re-imagined retail industry driven by the integration of online, offline, logistics and data across a single value chain. This is why we are adapting, and it’s why we strive to play a major role in the advancement of this new economic environment.”
This may sound more Utopian than realistic, but in China where the concept was formed, Hema Supermarket, an arm of Alibaba that specializes in new retail, has opened 64 Hema stores in 14 cities, with over 10 million customers shopping at these supermarkets since the beginning of 2016.
On average, for a Hema Supermarket that has been open for at least 1.5 years, daily average sales are upwards of 800,000 yuan (US$116,500) — about 60 percent of which comes from online orders. Based on Alibaba’s data, offering a combination of online and offline shopping options results in an increase in average monthly spending by customers. Consumers who shopped both online and offline at Hema spent an average of 575 yuan monthly, compared to under 300 yuan for purely online, or purely offline shoppers.
Pinduoduo, the $1.5B Chinese startup is also another Chinese e-commerce company, engaged in new retail. The startup is challenging the giant Alibaba in China’s towns and villages. In January, Pinduoduo had 114 million active users, surpassing that of New York-listed Chinese discount retailer Vipshop. Currently, the startup has captured a projected 7.0% of all retail e-commerce sales in China this year, not a bad showing for a firm that launched in 2015. In three short years, Pinduoduo has emerged as one of China’s fastest growing shopping startups, with as many as 55 million users accessing the site per day.
Pinduoduo’s idea of new retail comes by way of offering group discounts.
Here Is How The Idea of New Retail Works
The idea of new retail lies in thinking beyond the boundaries of the two-party system of retail operations, that is, e-commerce and legacy brick-and-mortar retailing. New retail, instead, focuses on employing an entirely new operating system for reaching and inspiring consumers to shop.
‘‘New Retail trade is trying to solve two particular core challenges in the industry,’’ Emmanuel Elem, an advocate of Sairui, Africa’s new retail startup said. ‘‘The first challenge is the challenge of cold war between offline and online malls. Shoprite is an offline multi-billion dollar shopping mall, for example. On the other hand, Jumia is an online mall. These two different malls are doing things differently and the truth is that they are struggling for the same customers.’’
Now, there are people who have sworn [or who are so internet phobic] that they cannot buy or make payment on the internet because they cannot see the person they are buying from. There are also people that say they don’t have the time to go to Shoprite and begin to buy things [be in the queue and waste their time?] when they have Jumia that can get them what they want in their houses while they wait patiently for delivery to be made. So what new retail is trying to do is to bring a marriage between online malls and offline malls.
By new retail, it will no longer be about online shopping malls. They will also have offline shopping malls or offline distribution centers where people can go, select what they want, pay online and if they don’t want to pay online, they can go to the mall offline and make payment and collect the goods, with the coupon they present to the owner of the shop.’’
He says new retail trade represents a system that blends the best of what both offline and online worlds have to offer. Apart from that, it also offers the best of an entirely new mix of human, digital and physical experience design, giving consumers a new means of inspiration, selection, immediate gratification, physical sensation and convenience, and that ultimately renders the distinction of digital vs. physical irrelevant.
Sairui, The First African New Retail Option Is Gaining Momentum
Although launched this year, March, Sairui is on course to change the idea of internet retail trade. Modeled after Chinese Pindoudou, the startup, which has its Africa headquarters in Accra, Ghana sells everything from clothing to hardware and other commodities and offers large discounts to purchasers. The startup has a strong presence in Nigeria and is also extending to other Africa countries like Cameroon, Uganda, Zambia, Tanzania, and other places.
‘‘We are doing this simultaneously,’’ said Elem. ‘‘Sairui is all about supporting grassroots entrepreneurship. Sairui shows people the possibility of starting to build a business no matter how small they have because with as small as less than 10,000 naira, they can become a business build through Sairui. This is exactly what it’s called pure grassroots entrepreneurship. Sairui also has bigger packages for those that don’t want to start with such small amounts of money.’’
The startup says it has multiple certified safeguard mechanisms, genuine licensed goods at lower prices and more reliable quality.
The Major Changes The Startup Is Bringing To The Table Are In The Logistics And The Customer Experience Areas
The startup offers large discounts to its online shoppers, bringing on-board an entirely new way of buying and selling.
‘‘What Sairui has brought in is the possibility of online and offline shoppers becoming business owners while also shopping. This has nothing to do with network marketing,’’ Elem said. ‘‘Network marketing is a different ball game altogether. Sairui has variety of products.’’
Elem said to handle logistics, the startup has physical shops where the online shoppers can go, present their coupons and redeem their goods or simply make new purchases.
‘‘Sairui is not opening up physical shops on its own. Sairui is opening up these physical shop through partnership or mini-franchising. These shops are called service centers. The centers are there to service our customers who can come and pick up these products. It is either you pay the company online or through these service centers. You can select your products online or you go to the service centers, give them your cash and carry your products. But the simple truth is that the products are going to be very affordable.Right now, we have about three physical malls in Nigeria through what we call Service centers. We service our customers through our customers centers there. We have centers in Cameroun. We have in South Africa. Right now, we have in about seven African countries.’’
For a startup that is just three months old, this appears a great streak of success, but the startup believes its incorporation of Jack Ma’s concept of new retail trade into its business strategy doesn’t just stop at setting up physical locations to enhance internet commerce experience but also that the strategy means consumers on the platform would get a chance to develop business interests from their purchasing or consumption needs.
‘‘Sairui is not a B2B company. Sairui deals directly with end users. We are dealing directly with the end users; people that are consuming these products. We are not dealing with business owners . We are making the end users business owners and also consumers linking them up directly with the manufacturers of these products, removing the middle person involved,’’ Mr. Elem said.
But it does appear that even the B2B middlemen would still have a say after all since the aim is to turn your consumption cost into instant profitability.
‘‘If you do some shopping on a $100 product on Sairui, for instance, we are giving you a discount of 60% on each product, meaning you’re getting a chance to buy two more products. Now, Sairui will help you sell those two discounted products you bought through its wholesale store,online or offline, free of charge. Sairui will sell each of them on your behalf at $100 each, the initial retail price at which you bought them.’’
The startup boasts it would sell off the products on behalf of its customers within a 7 to 10 days period, leaving customers with some unexpected side profit, long hours after they have made their first purchases.
‘‘We are the pioneer of this kind of system,” Elem said. ‘‘It may be strange to African markets, but the simple truth is that over 20,000 e-commerce companies are already using new retail to run their businesses in China. You can trade as many times as you want with one-time principal.’’
Elem said offering discount does not represent any loss for the startup because of a direct partnership with manufacturers of the goods sold by the startup. He said Sairui mall is an open market place just like Amazon, and as such, anything is bound to happen.
‘‘It is just like asking people why they drink water from a clean cup,’’ he said. ‘‘Nobody would see what is good and wouldn’t want to go for it. The general ideology of new retail is encouraging grassroots entrepreneurship. Sairui is a unique opportunity that anyone shouldn’t miss, even though not for the sake of profit, but for the sake of buying things affordable prices and getting free products from its online or offline shops.’’
Getting Started With Sairuimall Africa
To learn more about how to be part of the Sairui value chain, contact the startup’s country director on +2348039421770
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Even though e-commerce is seriously gnawing at physical shops. Physical shops with a messy environment would most definitely get a little crumb of what is left. Of the 70% of consumers surveyed in a study commissioned by ServiceChannel, a facilities management platform, and who said they had once experienced messy stores, over two-thirds have walked out of stores because of the way they looked.
The study suggests that struggling retailers who neglect stores to cut costs hasten their demise by turning off shoppers. The survey was carried out on 1,521 consumers and 70% of them said they recently have had a negative experience with a messy store.
Over two-thirds admitted they have walked out of stores because they were messy or disorganized.
Four out of five shoppers said they would rather have a clean store than ones with the newest tech, and two-thirds said retailers are forgetting the basics—like clean floors and well-stocked shelves—in the rush to add tech.
“The vast majority of purchases are still being done by people walking into a location. And their experience of that location has never been more important,” Buiocchi, the CEO ServiceChannel said in an interview.
“If you look at folks like Allbirds or Warby Parker, Bonobos or Soul Cycle or Shake Shack, their locations are so comfortable and well laid out and so well maintained. You would never walk into a Warby Parker or a Shake Shack and say ‘Man this place is messy.’ Or the lights are dim or it’s too cold in here. They just don’t let that happen.’’
ServiceChannel is in the business of selling software and services that allow retailers to manage store maintenance, connect with and pay contractors, and track invoices, so it is no surprise that it is touting a survey that concludes store cleanliness is crucial. But he has a point that is often overlooked by retailers.
With ServiceChannel, retailers can book contractors and manage maintenance jobs on mobile phones.
“Much like when you get an Uber or Lyft ride and the entire ride is digitally recorded, the transaction is digitally recorded so someone 3,000 miles away can go fix a toilet for you at a Banana Republic and you will know based on the GPS coordinates when that person got there, how long they stayed, whether they showed up on time, and they can send you a picture,” Buiocchi said.
ServiceChannel is seeing that many of the new online brands that are opening stores are quick to recognize the value of rigorous maintenance and are signing up as customers.
“There are the people that get it, and there are the people that don’t get it,” Buiocchi said. “Five years from now what are the chances that the people who don’t get it are going to be in business?”
Buiocchi says reports of a retail death end are overrated. As stores close, new retail disruptors are opening locations and expanding.
“Good progressive retail is investing in their brick-and-mortar experiences and enjoying the benefits of that,” he said. “Bad retail is not and they’re unfortunately being penalized for that.”
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Despite listing on the New Stock Exchangeand getting called a fraud by Citron Research and begging to be given one more chance to prove its mettle, Jumia is giving reasons why it listed on the New York Stock Exchange instead of the Nigerian or the more developed Johannesburg Stock Exchange. Here are some of the reasons given by Jumia for this.
Jumia CEO, Juliet Anammah
Despite listing on the New Stock Exchangeand getting called a fraud by Citron Research and begging to be given one more chance to prove its mettle, Jumia is giving reasons why it listed on the New York Stock Exchange instead of the Nigerian or the more developed Johannesburg Stock Exchange. Here are some of the reasons given by Jumia for this.
E-commerce Business in Nigeria and Africa Has No Long-term Investors
Jumia said the first reason why the e-commerce giant had to bypass the Nigerian and other African Stock Exchanges is because e-commerce in Africa has no long term investors. This is why, according to it, it had to explore the American market, where there is deeper understanding of how the market works. In fact, for Jumia Nigeria’s Chief Executive Officer (CEO), Juliet Anammah, Nigerian investors are impatient and can’t wait for long-term returns on their investment. American investors, on the other hand, are prepared to invest and wait for long term returns on investment (RoI).
Konga As A Case Study
Even Citron Research, which cited Jumia for fraud wrote this about Konga, Nigeria’s second leading ecommerce company which has been acquired by Zinox Group.
The divestment of Naspers(a South African company), ‘‘the smartest and largest tech investor in Africa’’ from Konga, another online eCommerce company in Nigeria was not due to a lack of funds or a short-term investment horizon,[after all,] Naspers has $12 billion of cash on the balance sheet and its original investment in Tencent ([in which it] still owns >30%) dates back to 2001… Rather, this decision was a reflection of Naspers’ bearish view on the Nigerian eCommerce market vs. a bullish view on South African eCommerce. Since its Konga exit, Naspers announced plans to invest over $300 million in South African tech businesses,’’ Citron noted.
Of all arguments, the least would be that Naspers divested from Konga not because of a short-term focus. Tencent, which Citron cited, is not notorious for ecommerce business, like Alibaba or Amazon. In fact, Konga was founded in 2012. Naspers acquired 50% equities in Konga in 2013, a year after Konga was formed, and finally divested in 2018, a space of five years. This does not disclose a longer term investment of say, 10 years.
E-commerce Platforms Are Not Reputed To Make Profit In The Short Term
Another reason given why e-commerce business have issues with investors is that it hardly makes profit in the short-term.
Anammah said e-commerce platforms are not reputed to make profit in the short term, stressing that investors in Alibaba had to wait for long term Return on Investment.
It took Amazon, the global leading online retailer as a public company to make profit. The company first reported a quarterly profit in the fourth quarter of 2001 and at $5 million, which may not be too attractive for investors. It did not come as a surprise that towards the end of 2017, Amazon reported a whopping $1.86 billion in net income. This does not seem to bother Amazon CEO Jeff Bezos whose cardinal business objective was to sustain more investment for the future growth of the company.
Much of Amazon’s profit was bolstered by the US tax cut, which added about $790 million to its profit in accounting terms. Take that away, it would have taken Amazon a longer time to make profit.
So When Will African E-commerce Companies Consider Listing In Their Countries?
Jumia Nigeria’s CEO Anamma said listing on the African Stock Exchange would take would not take a much longer time than expected. Jumia said this may happen soon, by 2022 when investors must have understood the dynamics of the industry.
Jumia Finally Comes Hard On Citron
Anammah said Jumia is seriously considering launching a legal battle against Citron Research which released a controversial report recently.
“We are looking at it (taking legal action). The board is looking at it. Some recent allegations were made about Jumia on the basis of selected, biased or unverified facts with what appears to be a clear objective of damaging Jumia. We held our earnings call on Monday May 13th and we published our first quarter results, which we are very pleased with, and provided information to demonstrate those recent allegations are wrong, ’’ Juliet Anammah said.
Jumia, on April 12 2019, became the first African tech stock to list on Wall Street and its shares soared as analysts branded it the ‘Amazon or Alibaba of Africa’. But the shares fell sharply after Citron Research’s publication which questioned some of Jumia’s sales figures and accused the firm of fraud. The shares have since rebounded.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
Latest figures from the United Nations’ Conference on Trade and Development show more people are resorting to shopping online around the world. Below is a quick summary of the facts and figures.
.Sales conducted on the internet increased by 13 per cent in 2017, reaching $29 trillion.
This number was made possible because, according to UNCTAD, more people resorted to shopping on the Internet. Hence, the number of online shoppers, moved up by 12 per cent so that a total of 1.3 billion, or one quarter of the world’s population now make sales through the Internet. However, though most Internet buyers bought goods and services from their domestic online shops, the number of people buying from abroad rose from 15 per cent in 2015 to 21 per cent in 2017. A significant percentage of this number came from buyers from the United States.
. More Businessmen are Buying from More Businessmen as against more Consumers buying from More Businessmen
The number showed that when the transactions involved two countries, business-to-consumer (B2C) sales reached an estimated $412 billion, making up for almost 11 per cent of total B2C e-commerce. Other B2C sales happened inside the countries. This represented about 4 percent increase from 2016.
The figures also showed that while
transactions conducted between businessmen in these countries–that is business-to-business
(B2B) e-commerce– has more than 88 percent of all online sales, B2C grew the
more in the year under review. To be sure, B2C sales increased by 22 per cent
to reach $3.9 trillion in 2017.
.More Online Sales Are Conducted in China Than Anywhere else in the world, while more Consumers in the UK are More Willing to Shop Online Instead of Visiting A Physical Shop.
The facts showed that more consumers
in China bought directly from businessmen using the Internet by the accumulation
of numbers over the years, obviously because of China’s largest population. However,
UK consumers were the most likely to shop on the Internet because a staggering
82 per cent of people aged 15 and older made purchases online in 2017.
Overall, however, about 440 million consumers bought from businessmen on the Internet in China, making China the country with the largest number of Internet buyers followed by the United States, while the United Kingdom held on to third place.
.In Terms Of Who Made The Most Money From These Online Sales, US Did.
In fact, with almost $9 trillion, online sales made in the United States were three times higher than that made in Japan and more than four times higher than that made in China. Germany also overtook the Republic of Korea as the fourth largest online market.
.Findings From The Report Showed That There Is Still A Huge Gap In The Ecommerce Market.
The UNCTAD report showed that there is still a huge gap in delivering digital services such as insurance, financial services or business processes, especially in developing countries such as Nigeria, as the sector grew yearly by 7-8% over the decade, and they were worth $2.7 trillion in 2017. . While developed countries still retain the market share, that is 77 percent, developing economies in Asia are seeing the biggest increase in exports over the past decade. Sierra Leone, a small-sized West African country emerged Third in digitally deliverable services, as a share of all service exports.
.What These Figures Mean
“The new figures show that e-commerce is indeed creating export opportunities. But the question from a development standpoint is whether businesses in developing countries are prepared to seize the opportunities,” UNCTAD Secretary-General, Mukhisa Kituyi, said.
“From an economic development perspective, this is important, because it shows the potential of digitalisation for businesses in developing countries that are producing such services,” said Shamika N. Sirimanne, who directs trade and logistics division at UNCTAD.
Charles Rapulu Udoh
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
