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Kenyan SMEs leverage e-commerce to compete with the big boys

BUSINESS

Kenyan SMEs leverage e-commerce to compete with the big boys

80% of the products on online retailer platform Jumia are from accredited small businesses (SMEs), the company has revealed. This number grew by 45% in 2016 with many of these businesses, having only recently made their first ever online sale.

According to Jumia Managing Director Sam Chappatte this trend has been attributed to Jumia opening up its platform to vendors in new categories (like Beauty) and retailers rushing to join the platform ahead of Black Friday

“We have seen a spike in the number of merchants joining our platform in recent months. This is great news for customers, as it means more choice of products and will lead to better prices. It also proves that our platform offers a great money making opportunity for professional, ambitious vendors of all sizes”  Sam Chappatte said.

Recent data from Jumia also indicates that the online marketplace is rapidly diversifying into new categories such as consumer goods (up over 100% year on year), Beauty (80%) and Baby, Kids and Toys (+44%). Unsurprisingly, categories such as automotive, books and stationery have not been focus areas to date.

According to global marketing firm AC Nielsen Kenyan consumers spent more than Kshs.10 billion on online shopping platforms in 2016. This figure is up from 2.4B KES in 2014 according to the Communications Authority of Kenya). This only means that e-commerce has indeed become an integral part of the economy.

“By helping small businesses (SMEs) grow and creating employment for thousands of Kenyans, e-commerce contributes immensely to Kenya’s economy. The fact that sellers can sell from the comfort of their homes without opening expensive stores is pretty impressive.” Anne Kirima, Chair of the Kenya Investment Authority said. 

Jumia has also launched a new project dubbed #GrowWithJumia – designed to educate and equip retailers with the technological knowledge to sell online. Under this project, Jumia will allow retailers to sell on the platform and benefit from its large customer base taking only a minimal commission of 1% on their sales for a 3 month incubation period. Jumia will also offer weekly payment terms to help them recycle their cash.

Featured Image: Jumia managing director Sam Chappatte (left) and Ann Kirima, Chair of the Kenya Investment Authority during a media briefing in Nairobi.

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Nixon is a Kenyan based freelance journalist and blogger interested in all things Tech & Business. Also a Public Relations (PR) expert, Founder & Editor of TechTrendsKE. For pitches, story ideas, guest posts or sponsored content, drop me an E-Mail at nickcanali@gmail.com or call +254 727 503 198.

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