Kenyan Online Businesses Zinaanguka !

Wangwana , are kenyan online businesses like OLX , cheki , pigia me making any money coz watu nikama hawazijui … i rarely hear anyone mention them as i expected…

Having Kenyan domain extensions doesn’t make them Kenyan businesses.

Some are very successful chini ya maji. The problem with Kenyans is they don’t trust a product they can’t touch physically.
Mkenya anaweza nunua products Amazon ama Ebay lakini akatae kununua Jumia ama Cheki.

Alafu taxes inamaliza industry. For instance, electronics are cheaper in Luthuli than in Jumia.

OLX made losses and exitted the market last time I checked… Jumia is making losses in the billions and may not survive beyond this year https://www.fool.com/investing/2020/01/02/jumia-faces-an-uncertain-future-as-it-retreats-fro.aspx

the smaller brands like cheki, pigia me, buyrent.co.ke e.t.c are surviving but obviously they don’t make any money

Nobody has figured this market out yet, only the traditional businesses are doing something meaningful with their online channels e.g Pizza restaurants, clothes retailers and supermarkets

These guys figured out the system a long time ago. They make money through inflated overheads, making losses to avoid corporate taxes. Things to watch out for - payments for platforms & operating systems developed outside the country, consultancy fees… Huge salaries for top leadership - read owners…
How can Uber claim to make losses na and they collect 25% of gross revenue considering they have zero costs on the MVs?

You didnt even read my post ?

but how are they still surviving …they must be doing somethin right , ama ?

Money from investors… that is how startups survive while still loss making… it’s usually okay if the company is growing but hapa sioni growth

Some of the most important factors that impeads Kenyan e-commerce are

  1. Kenya does not offer physical addresses with zip codes
  2. Very few Kenyans possess credit cards

Amazon was loss making for over 10 years because they were investing in growth…from a small online bookstore to a trillion dollar company. today, they turn profit in the billions of dollars …

Also, note that reporting losses does not necessarily mean founders and investors are losing money e.g uber makes billions of losses but most investors have made lots of paper wealth as the company valuation continues to grow which they can translate into cash by selling the shares…

There is a big incentive for businesses to make losses if it enables them to grow fast, shida ni hiyo growth ikose ku-happen… I don’t think its fraud, but it definitely helps with tax avoidance since past losses can be claimed as tax credits for years

Credit cards za nini na tuna Mobile money?

Shida ni trust…OLX watu walioshwa proper. It is now Jiji. Pale kilimall unauziwa kitu ukiwa delivered unashangaa. Jumia did a nice thing of introducing pay on delivery, but still not many people trust online shopping. Delivery network and costs also a big hindrance.

Problem ya hapa mtaani ni bait and switch…untill that changes no one will have trust in the online shopping

Yes you need a credit card to do international transactions.

Wewe na hii international umetoa wapi. Or you can only think of ecommerce as buying things from the US?

Payment for IT, technical Support, payroll, advertising,

How comes we trust Glovo and meat delivery from City Market… Hii ni food hujaona ikipackiwa na nyama hujui kama iko na mafuta… Naaminingi kamundiabutchery.co.ke sana na ni ya city market

It doesn’t matter, thing’s are the way they are at the moment because of such constraints.