Exclusive Deals Bad for Small Ecommerce Players’ Growth – Former OLX Executive

ecommerce industry

In as much as there is room for business in the ecommerce platform, the industry players need to develop smart collaboration and work around the building customer trust, one of the biggest barrier in this market according to experts.

Unlike the traditional model, the online platforms are switching to the market place model as it is aligned to service provision to paying customers or vendors yielding value while growing your customer base. Studies forecast a 300 million job creation by the e-commerce industry by the tear 2025, affirming that sector is and will be impactful in the country’s Gross Domestic Product.

The emerging African market is looking at ‘everything’ app’ for a wide range of services including grocery shopping, food delivery, cargo, and many other on-demand services as the economics of business models in e-commerce is forcing other sectors to move into a super app.

According to Peter Ndiangui, former OLX executive and CEO Gobeba; an on-demand e-commerce logistics platform operating in emerging Africa market, having been in the industry for 15 years, there has been rising consumption and lots of digitization in the e-commerce platform which has been very revolutionary.

In as much as the ECommerce is a lauded for impacting the economy, there are a few out of hand matters that if not looked into would tarnish the reputation of the industry, a common one being locking e-commerce participants in through contract exclusive deals.

“Exclusive deals could have a significant downside on the e-commerce innovative ecosystem. Competition Authority of Kenya should look into the matter,” he mentioned in the E-commerce platform held at Nailab on Wednesday.

Locking participants in through offering vendors better services is not unhealthy but it’s one way a company can offer better services to the e-commerce market.

Sam Chappatte, Jumia’s managing director in attendance noted that there is the need for access to capital by SMEs to grow the upcoming eCommerce platforms because they are the future of the industry.

“Most SMEs are constrained by insufficient capital. What a merchant/vendor wanted from your platform are Returns on Investments and high commissions. As the business offering them the platform, your value proposition should stronger than that of your competitors. At Jumia for the last six months, we have been collecting data on our merchants and we are working on getting them more findings from our financial partners,” he mentioned.

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