- Ibadan based Alerzo raises $10.5M to digitise Nigeria’s informal retail sector
B2B Funding Nigeria: Alerzo, an Ibadan B2B ecommerce retail startup has announced a $10.5 million Series A round led by London-based Nosara Capital. According to TechCrunch, FJ Labs and several family offices participated in the round. The startup has raised more than $20 million from investors, including the Baobab Network and Signal Hill.
Remove the layers: The B2B platform cuts out the middlemen and helps traditional retailers source products from manufacturers and provide last-mile delivery to their trading spaces in less than 10 hours. Retailers can order products via SMS, voice, and WhatsApp.
Nigeria’s South-Western cities: Alerzo focuses on street vendors and micro-retailers in Nigeria’s South-Western cities, including Ibadan, Ekiti, and Abeokuta. According to the company, they have established a network of up to 100,000 small businesses, 90% of which are women. The startup works with FMCG companies such as Unilever, Nestlé, Procter & Gamble, Dangote, and PZ.
Nigeria ecommerce competition: The B2B ecommerce space is heating up in Nigeria, with TradeDepot and Omnibiz recently also securing funding. TradeDepot raised $10 million in a new round of funding to expand its business into financial services, and Omnibiz raised a seed round of $3 million to expand into new markets.
Nigerian retail: The Nigeria’s retail market is predominantly fragmented, dominated by a complex distribution network of micro-retailers, kiosks, hawkers, table-top sellers, open market traders, wholesalers, and suppliers. Retailers are small, spread out over many locations, and with low volume per drop — distributors struggle to service them cost effectively. There are an estimated 1.2 million informal retailers in Nigeria, according to Nielsen.
With low consumer spending, slow mall development and currency devaluation in the country, modern retailers have found the going tough in the country. Shoprite, Africa’s biggest supermarket chain, last year announced its exit from the country.
2. Johannesburg’s informal traders call for police to stop confiscating their goods
Complains: Informal traders in the City of Johannesburg are complaining about the confiscation of their goods by the metro police. Traders pay between R1,600 and R3,000 to retrieve their goods.
NEDLAC: Traders want The National Economic Development and Labour Council (NEDLAC) to include them in the government’s economic recovery plan. As part of their new campaign called “Do No Harm,” traders are calling for better treatment, especially by metro police who confiscate their goods.
Good confiscation: Johannesburg Metro Police Department (JMPD) continue to confiscate goods from informal traders who allegedly violated the City of Johannesburg bylaws. The City’s informal trading by-laws state that officials must issue a detailed receipt for confiscated goods and list the address where the goods will be stored. According to JMPD’s Wayne Minnaar, police officers are taking action to prevent severe overcrowding, especially in Johannesburg’s inner city.
Large informal trade base: According to WIEGO’s 2018 Labour Force Survey, there are an estimated 470,000 self-employed informal workers in the three major Gauteng metros. Informal workers include street vendors, market traders, and self-employed people working in private households.
3. The impact of riots and looting on spaza shops in Johannesburg
4. Other news
MaxABs acquisition and funding: MaxAB, Egypt’s largest B2B ecommerce platform that serves food and neighbourhood groceries, has acquired WaystoCap, the Morocco-based B2B ecommerce and distribution platform. MaxAB plans to accelerate its expansion into the Maghreb market, empowered by WaystoCap’s expertise in the region. Additionally, MaxAB has confirmed an additional $15m investment from existing investors, as it closes its Series A, which brings the total capital raised to more than $60M. With the acquisition, MaxAB now services more than 70,000 retailers across multiple markets.
Yoco funding: South African payments startup Yoco has raised $83M Series C backed by Dragoneer. The company has over 150,000 merchants using its platform in South Africa. Despite South Africa’s high card and mobile penetration rates of over 70%, the country has over 6 million small businesses that still transact only in cash. The company is looking to replicate its growth in other parts of Africa and the Middle East.
MarketForce funding: Kenya’s MarketForce raised $2M and plans to focus on its B2B retail marketplace RejaReja. The platform helps informal retail merchants to purchase FMCG products and also provide financial services.
Suplias funding: The Nigerian B2B marketplace is targeting even quicker growth and international expansion after raising funding and taking part in the Silicon Valley-based Y Combinator accelerator. It helps store owners buy inventory directly from manufacturers using its app, and provide next day delivery. The startup has seen significant uptake – growing 40 per cent month-on-month for 11 months.
Bazaar Technologies funding: Pakistani blockchain-powered business-to-business (B2B) marketplace, Bazaar Technologies, has secured $30 million in the country’s largest Series A round to date. The round also saw participation from dozens of other investors, including Endeavor, LinkedIn, Japan’s Saison Capital, and existing investors Indus Valley Capital and Alter Global. Bazaar claims to be the leading B2B marketplace platform for neighbourhood groceries or kiryana in Pakistan, serving 750,000 merchants spanning 400 towns and villages, using its platform to purchase inventory from suppliers.
Udaan expanding: India’s Udaan has built the infrastructure and capacity to digitally connect and supply kiranas or neighbourhood groceries in tier-2 and tier-3 cities and rural areas in India. The company is planning to increase warehousing capacity five-fold to 4.6 million sq.m in the next few years to meet its supply chain requirements. The firm has over 3 million registered users that include kiranas, chemists, HoReCas (hotels, restaurants and cafes) and farmers. Around 90-95% of India’s population purchases from neighbourhood stores for everyday consumption.
Flipkart Wholesale: The digital B2B marketplace of ecommerce company Flipkart Group in India, has announced the launch of an industry-first credit programme which aim to help kiranas or neighbourhood store to access credit in just two minutes. Over 1.5 million kiranas will be able to apply for credit through Flipkart Wholesale’s partnership with lending partners and fintech institutions.