Online shopping has become second nature to some of us. Whether or you are buying or tech from amazon, second hand goods form Ebay, or even your groceries from a super market, e-commerce has the changed the way we use our shopping time. In Africa, it hasn’t had such a big impact due to lack of delivery infrastructure and ability to pay online securely as well as complicated and inefficient customs protocol. With M-Pesa and other mobile money systems some of those problems are being solved.
The biggest e-commerce player currently in the African market is Jumia. Jumia Group, which was formally known as Africa Internet Group, was Africa’s first private tech startup valued at over $1 billion. (A unicorn). Their e-commerce website is similar to Amazon, split up into categories. They offer a classic purchase option using credit card, but also customers are able to buy their products when they receive them, in cash. This opens up the service to everyone who has access to the internet, as they no longer need to worry about security issues of paying online, or whether they have a bank account and card.
In Nigeria, Jumia makes thousands of deliveries a day. In the first 9 months of 2015 they made revenue of $206 million. With such numbers, Jumia are clearly keen to take over the African market, before Ebay and Amazon jump into the market. In fact, Ebay seem to be beginning to show an interest in Africa, after signing a contract with International Trade Centre, which is the joint agency of the World Trade Organisation and the United Nations. The partnership aims to boost the capabilities of SME’s in the developing world by enabling them to access the global digital commerce market. By enabling SME’s to get online and sell their products worldwide, it will boost exports form Africa. Currently, there are much more imports rather than exports, and the continent to equalise this in order to secure local currency, as well as show that Africa is trustable to investors.
Another innovation to help e-commerce and the logistics of delivery in Africa comes from MAX. MAX is a hyper-local on-demand delivery platform for businesses and consumers in Urban Africa. Their “Delivery Campions” pick up and deliver packages in cities by utilising dispatch algorithms, Mobile Apps and crowdsources Geo-tags. Their network of trained drivers are able to solve Africa’s last mile challenge. It is time consuming and costly to go and get your product from customs, or a pick up point yourself. It takes convenience for e-commerce to take off, and they seems to be on its way.
One example of an e-commerce company that excites me is Zuvaa. Zuvaa is a marketplace to find unique African fashion. The site works with emerging designers and bring a high quality variety of fashion to Africa and the world. What really excites me about this is that Kelechi Anyadiegwu started the company with just $500. So many people attempt to start up their companies with funds that they do not have. Kelechi has proven that with a small amount of money and hard work you can grow your company. Zuvaa is estimated to make $2 million of sales this year, and with the expansion of e-commerce solutions in Africa, it can only expect to grow faster.
There is so much potential for the e-commerce sector across the African continent. From fashion to food, electronics to agricultural products, and animals to educational material, the market is massive for all products. Already, on Facebook, people have been trading informally and the market is ready for an Ebay like company to take control.