In sub-Saharan Africa, 80% of household retail is delivered through informal channels, which face a number of challenges, including stockouts and a lack of attractiveness to financiers. Micro-retailers across the continent are facing challenges, and a B2B retail marketplace for informal retailers is working to resolve them.
Informal traders can source fast moving consumer goods directly from manufacturers or distributors through the Betastore marketplace, which keeps the prices of the products competitive by eliminating interactions with sales agents. It works with partners to make sure goods are delivered in 24 hours.
By the end of the year, the startup plans to provide these services beyond its current three markets, after closing $2.5 million in pre-series A funding from 500 Global, VestedWorld, and Loyal VC. $3 million has been raised by the store.
We need to be able to continue to scale by using our asset-light model. We plan to enter new markets before the end of the year and to expand to 100 cities across Nigeria,Ivory Coast and Senegal. We are also planning to strengthen our technology and leadership teams, and to bring in new products and to improve existing ones, according to the CEO of the startup.
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The asset-light model means that there is no capital or labor intensive assets like warehouses for delivery. The startup's technology has been improved to ensure that retailers source goods from the closest distributors. A retailer using Betastore makes an average of 4.2 orders per month.
Retailers can order on demand, access a variety of products and solve logistical headaches with our technology. They don't have to close their shops to get goods from distributors or the market, and they don't have to lose a lot of money in the logistics, according to Dakayi-Kamga.
A pilot program involving 200 retailers was carried out by the B2B platform last year.
The financing strategy will be based on the sales of retailers and will help them grow their businesses. The startup will charge an interest on product margins.
A network of financing partners including banks and fintechs are currently being integrated into the technology of Betastore.
Some of the partners that we have on board are not able to lend to small businesses because they do not have the data to inform decisions. We have the visibility of what is happening in this sector, and have data they can use to extend financing, said Tchoudjang, who previously held executive and leadership roles within the AccessHolding AG network in Africa. He helped Multinationals roll out products for emerging markets in the past.
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Retailers can use the Betastore wallet to repay loans, deposit money for their operations, and to send, receive and save money.
The wallet helps them separate their business money from their own money, and it is directly connected to the whole banking system, meaning that retailers can receive and send money to any bank, and load cash with any agency banking platform.
The startup claims to have grown its customer base by 10 and 12 times. The startup anticipates greater growth after entering more countries and rolling out its buy now pay later product, as it taps the retail market in sub-Saharan, which was valued at $380 billion in 2021, contributing 20- 50% of the region's GDP on average.
We want to simplify access to goods and services for the retailers and for the end consumer because we see the merchant as an agent. We started out in Nigeria, and we are going to be a pan African player.
The principal at 500 Global commented on the latest funding round and said that they believe that the talented team at Betastore is creating market efficiencies that have the potential to boost the growth of Africa's retailers. Merchants can get more transparency into their inventories with the help of Betastore.
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