ECOMMERCE IN AFRICA

When you purchase a good or service online, you are participating in e-commerce. Most firms that engage in e-commerce are large ones, mostly in the IT sector. Meaning, there is a need for sensitization among business firms. Taxi Tech Company Uber, although until recently, owned no cars, is worth more than Volkswagen. Airbnb, which simply matches people needing rooms with those who have no rooms, is worth more than Hilton hotels. Alibaba which hosts more than eight million entrepreneurs of which 62 percent are Small Medium Enterprises [SMEs] is worth more than the GDP of the East African Community [EAC] and Southern African Development Community [SADC] combined.

The unique and outstanding thing about them is that they have simply developed a context based economy by providing needed information from an end to end user and be able to create wealth. For Africa’s e-commerce to develop a context based economy, the bigger picture should be to re-organize small firms especially in the rural areas by scaling up through online platforms in a cross-continental trade. For example, soap stone carvers in Kisii County should be able to access clients in other bigger cities like Lagos. This also means that the success of e-commerce is not only built on fast rising internet coverage but equally due to skilled entrepreneurship aided by a very good logistics network that will help deepen markets.

Delivering an item to a customer’s address is hectic. Lack of an address system in Kenya, in particular, and Africa in general means that it will take long before a logistic firm can locate the exact address of the customer to drop the package. Normally, the logistics company will incur an extra cost of calling a customer to get their address. They will spend more time and fuel trying to locate a customer’s address. However, in Kenya, there are various tech innovations that are aimed to curb such a problem. They include M-post and Pick-n-Drop apps which provide a simple, elegant addressing solution. Such an innovative product allows you to enjoy postal services at your fingertips at home, in the office, or on the go at your convenience. It is an exciting innovation that makes a mobile number be a formal postal address.

While it was slow off the mark, Africa’s digital landscape is undeniably gaining momentum and power. We believe, Africa is well placed to be the next big e-commerce market with major revenue potential. Global merchants should prioritize this market while the landscape is still wide open and able to be shaped. Almost 280 million Africans have mobile wallets which is three times more than the number of Africans with bank accounts. Knowledge and innovation are pivotal in Africa’s quest for sustained and inclusive economic growth and should therefore be encouraged based on both targeted government policies and private sector participation.