Every year, billions of dollars’ worth of consumer goods are sold in high-growth markets. However, the supply chain that moves these products from the manufacturers to distributors and eventually retailers is broken and no longer fit-for-purpose. The current traditional distribution model is inefficient, cash-based, and depends almost exclusively on manual processes.
This inefficient distribution system prevents brands from driving sales growth, as it provides zero visibility across the supply chain. As a result, distributors are forced to spend more time and money to distribute essential products to retailers across the highly fragmented market.
Digitizing the B2B supply chain across the retail market can increase its efficiency, but there are no digital solutions that empower brands to gain control of their supply chain and increase distribution effectiveness amongst existing channel partners.
But Open Commerce is changing this.
Open Commerce is a new way of trading that unlocks the full value of the traditional supply chain. With Open Commerce, brands and distributors can digitize the entire distribution process, making it possible to drive consistent growth and move goods from the manufacturer to the end consumer as quickly and cheaply as possible.
Taking Open Commerce to Toiletries and Cosmetics Manufacturers in Nigeria
In July 2022, RedCloud sponsored a CEO’s event for Toiletries and Cosmetics manufacturers in Nigeria. At the event, our COO, Soumaya Hamzaoui, presented our bold vision for the future of the $3 billion toiletries and cosmetics industry. A future powered by Open Commerce, where brands and distributors have complete visibility and control over their supply chains and distributors.
The CEOs in attendance were very excited by the possibilities that Open Commerce presented for their businesses and asked several insightful questions. We’ve compiled some of the questions and the brilliant responses Soumaya gave.
Note: The questions and answers have been lightly edited for more clarity.
Our COO, Soumaya Hamzaoui taking questions at the just concluded CEO’s event in Nigeria
Question: One of your aims is to support small businesses and retailers. How do they subscribe to your services, and how do they benefit from that subscription?
Soumaya: Regarding subscriptions, we do not have any. It’s Pay-As-You-Go. So, as you sell on the platform, we take a percentage on each transaction, a tiny percentage, which is much less than other e-commerce solutions take.
To help small businesses, we do more than just give them the technology and leave them to figure it out. Many of these small businesses operate in a world where everything is written on paper, so we’re investing in a solid team that will educate these retailers and show them how best to leverage the technology. Our field officers have worked with many small businesses and retailers to develop several use cases for our solution, and as a result, we’re happy to report massive growth of up to 40% for small businesses.
Follow-up question: What is your definition of a small business?
Soumaya: For retailers, a small business can be as small as a kiosk or a one-person mom-and-pop roadside shop. For distributors, it can refer to anyone doing anything from $30,000 worth of trade up to $500,000 and even more. So, we do not have a lower limit on who can use our technology. That’s why we put it on the Play Store, not behind a paywall, so anyone and everyone can access the benefits of Open Commerce.
Question: There are more than ten e-commerce providers in Nigeria right now; what is RedCloud’s position in the market, and how is it superior to any of the other players in the market?
Soumaya: Most e-commerce players today focus on the B2C market segment, but that is not our focus. The few players that are in the B2B sector, there are primarily set up as distribution companies themselves. They buy stock from brands in bulk and sell it at discounted rates into the market, but that is not our model.
Our model is to work with existing players across the distribution chain by providing the technology they need to grow their businesses. We don’t buy stocks and don’t have warehouses, we are a pure technology player, and this means that our partners do not need to worry about us hijacking control of their supply chain.
No company in Nigeria today unlocks the traditional distribution model in this manner, but I am confident that this is how business should be done. No single company can buy all the stock in the market or control the entire supply chain, nor should they be able to. Therefore, we firmly believe in decentralizing the supply chain and empowering brands, distributors, and retailers.
Question: How much of the market do you plan to penetrate? Do you plan to stay with only key accounts?
Soumaya: As I stated earlier, we are not focusing on only key accounts. We are focused on empowering every retailer, distributor, and brand with Open Commerce, no matter their size. We have a strong go-to-market team that is split into multiple levels. Some team members are specifically dedicated to looking after key accounts, while other members of the team look after the long tail of the distribution chain.
We are building a system that can sustain the entire supply chain from end-to-end. This is important because of the data that the market needs. Brands need to understand who is buying your products and what retailers are carrying your products. To provide this critical data and generate real value for everyone, we must do the hard work to go into every part of the market and provide brands with the insights that they desperately need.
Schedule a demo today to find out more about Open Commerce and how it can unlock the value in your supply chain and drive growth for your brand.
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