One of the many hurdles facing small business particularly in Africa is access to the market.
Whether that market is physical or digital matters little because getting access to a retailer is a problem.
Of course a startup could set up its own retail environment complete with secure payment facilities, a logistics department, build a reputable brand and drive traffic to its own marketplace.
The alternative is to use an existing digital marketplace such as Takealot, Amazon or even Etsy.
“Digital marketplaces are contributing trillions to the global economy. The ability to connect buyers and sellers is catalysing unprecedented entrepreneurial growth and, in many ways, is just getting started,” says head of marketplace at Takelot, Frederik Zietsman.
Using a digital marketplace takes care of distribution and serves as a way for startups to get their product noticed. Owner of birdseed production firm Valemount, Amy Westerman, says Takealot has helped their small business grow.
“Our marketplace listing has allowed us to extend our reach to customers in far outlying areas. These customers are now given the opportunity to buy the “fancy products” which in the past were only available in the main centres,” says Westerman.
Distribution is just one reason Zietsman recommends startups and SMEs opt for a digital marketplace, in fact there are ten reasons which he offers up below.
Online spending is increasing
PayPal and Ipsos’ cross-border commerce report predicts SA’s online spend to reach R53 billion this year. There are big opportunities for SMEs that capitalise on online marketplaces but also a growing gap for those that don’t benefit from these.
Credibility and trust
For some customers, it feels safer to do online transactions with a big ecommerce name like takealot.com than a small, relatively unknown SME.
A bigger reach with fewer resources
Established ecommerce sites often have large and loyal customer-bases for small businesses and entrepreneurs to tap into.
A seamless end-to-end customer journey
Operating via these platforms allows SMEs and entrepreneurs to offer new and existing customers an elevated level of service.
Delivery logistics are taken care of
With the marketplace delivering the SME’s products to the customer’s door. How fast a customer receives his or her goods is directly correlated to the prospect of repeat business.
Marketing best practice
Not only will the marketplace help package products beautifully, they’ll also have best practise marketing, SEO and analytics, all of which help a business grow.
A marketplace system is ideally positioned to provide truly rich data. From buying habits to emerging trends, a digital platform allows for analysing and understanding customer demands.
No need to invest in bricks and mortar
Robert Friese of Eurocare Wellness says that an online marketplace gave them instant access to the market without the need to invest capital in retail outlets. “Without listing on takealot.com there would be no business – we got instant access to the market. We now grow by an average of 10% month-to-month,” Friese says.
Big marketplaces can also offer training and continuous learning opportunities to sellers along with specialised skills to bridge capability gaps.
Growth… and lots of it
An established marketplace allows for sellers to quickly – and affordably – reach a much broader audience. No longer confined to a physical location, business owners are now able to promote their products easily and more efficiently.
With these reasons in mind it’s worth considering how an established marketplace might help your business.
As we’ve seen some businesses are already benefiting from Takealot’s platform, perhaps it’s time for your business to consider it as well.[Image – CC 0 Pixabay]