E commerce is profitable and sustainable in nigeria... But the present companies are doing it the wrong way... Your friend should first bring a solution to the problems mitigating ecommerce boom in nigeria, add the solution to his business model and watch his brand become no1 in less than 5years.... Did you see what voguepay and paystack did in the payment gateway industry in nigeria... #word

He has to keep his operational costs low and be very niche. Sell something specific that people actually buy online.

Its is profitable just make sure you do your research before investing.

Good news... A Team of experts from the Philippines called Royale Global business club are here in Nigeria to launch #business PROJECT#. This is beneficial to those who are interested and partners are needed.

Individuals who are interested can drop their full details at my gmail

ijeybest8@gmail.com and i will get back to you

Thank you and blessings.

ikihealthplus:
A friend wants to invest heavily in xx millions of naira but I told him to hold on and do some research on its profitability and sustainability because big Giants like olx, jumia and Konga recorded losses last year due to a couple of factors. So friends in the house, I need your input so my friend doesn't invest ignorantly. Is it wise engaging in e-commerce in Nigeria? What are the challenges and can it be overcome? Mods..lalasticlala please bring this to front page

focus on a nieche and a location.
Ecommerce costs money. Why? Because of inventory.
There’ are two ways to scale an eCommerce company. Slowly and profitably or fast and unprofitably.


do not let any one deceive you about Paystack and voguepay, they arent making any profit and their business is not ecommerce

my guy ecommerce is not profitable in Nigeria, konga and jumia arent making any profit, that is why the owner put in lot of cash so that they can eventually sell it to top ecommerce companies in the future.

Your friend wil lose all his money in ecommerce, do you think he can compete with jumia, they have all the cash and can never go broke. guy think again, if possible do something different. that market is over crowded.

What do you want to sell that we cant buy on jumia or on konga or any outside shops, can you compete in price, discount and also logistics

if you think you are going to ecommerce business in Nigeria because the top players arent doing it wel, then you are doom for failure

can your friend money compete with almost $72 million or more spent on jumia or $64 million dollars spent on konga, infact konga was recently sold for peanut

if you can answer this question positively then do it if not run away

MimiShopping:
You are good. You sound like an expert, I love this

As in, I had to follow the niccur. Nice one tiwiex

majekdom2:
The time for e commerce is gone. The internet is shifting.... he will struggle. likes of Alibaba and Bezos cashed in when ecommerce was the embryo stage. It wasn't making sense to many either. This is what big data and IoT is like now. He should look into IoT, VR, AR ideas, they will create millionaires over the next decade. The future of shopping is VR. imagine wearing a VR lens in your home and you are able to visit the shop floor of Shoprite or go the store of any e commerce store. Put simply a VR creates a real life experience

Pls shed more light on this, can you?

Looking for a viable company to partner with or invest in? FOHOW is a member of the World Economic Forum Find out more: https://www.facebook.com/phoneixps/

I mailed you through NL. Pls reply. Than KS.

tiwiex:

This is really a good question the fellow asked. Jumia and Konga made heavy losses that have definitely been written off. We talking about 40 million dollars for Jumia alone. Google to see specific details but it's huge.

Like I told a client yesterday. The site is one thing and it's like 20% of the work. It is just a window view to the world for your business. You still have to get a back office. Like you rightly suggest, the back office has to be thin.

What exactly is OP selling? How do you handle your suppliers? Are you stocking and tying down cash? Is it a just in time (JIT) model that require little or no storage? I think we call that drop shipping now. How do you handle logistics? I think this is one area Nigeria falls short. Shipping is dependent on the country's existing transportation infrastructure. In the US for instance, the US postal service ships for Amazon. So Amazon really doesn't handle logistics.

Finally, what are you selling? If it's that important, people will buy ecommerce or not. I built an ecommerce for a friend. She sells weight loss products. She really didn't even need the site because she was already selling impressively. Infact, she rarely even remembers I built a site for her which really hurts my effort. But it just means the product is the most critical thing obviously. So think about this.

Marketing is key because you need awareness. She gets 80% of her customers through Instagram. So you have to check out all these issues. Are you a techy person and want to build the site yourself or a business man? Techy people and business and not usually clear on the business goals.

Finally, I think the ecommerce market in Nigeria is over exergerated. I can't remember the last time I shopped online. We think we have the volume to break even. This is how Jumia and Konga did themselves in. Maybe the volume is not that large but if you do your marketing right and do not invest heavily. You might be up to something. All the best.

Think about all these. The ecommerce site does not automatically lead to sales. The products and your awareness campaign does.

So, I heard you are looking for advice concerning e-commerce in Nigeria.
You said it is the B2C type like konga, Jumia, Amazon etc.
Here is what you need to do

Avoid extravagant advertising

Most companies out there think, the first step in launching a business is to start by advertising, this is not true, this will harm the business in the long run.
An example is advertising on television and radios, avoid this. I didn't say not to advertise. The type of advertising I recommend is social media advertising. It is more viral and will help in building a brand image.
Focus on one thing

The second thing, I would like to advise is for you to focus your e-commerce business on a certain branch of products, if possible on a certain type of product eg an e-commerce site focused on female fashion only, and then expanding from there. This will help you in reducing costs. Amazon is a good example of companies who focused on one product, books. From there they added cds, toys, music, movies, and fashion.
It is after you have dominated the market with that product, that you can then diversify to a relative product.

Focus on a specific location, and then expand

This point is very easy to understand but very few companies carry it out. Nigeria is a tough country to start a business. In order to reduce cost to its lowest, you don't have to open shops in Abuja, lagos, rivers and start doing state to state delivery. That will burn the money quickly, start in a town in that state, promote the business there, do inter town delivery.
When you get money expand slowly

cvibe2:


Don't forget Olx ran away, Konga ran away before it was bought by zinox computers(yudala)

Olx had to change operation base. Konga now using yudala offline offices which is cool to me..

GrammarNazi1:
Uber and Taxify don't...

Thanks for the correction...

tiwiex:


This is really a good question the fellow asked. Jumia and Konga made heavy losses that have definitely been written off. We talking about 40 million dollars for Jumia alone. Google to see specific details but it's huge.

Like I told a client yesterday. The site is one thing and it's like 20% of the work. It is just a window view to the world for your business. You still have to get a back office. Like you rightly suggest, the back office has to be thin.

What exactly is OP selling? How do you handle your suppliers? Are you stocking and tying down cash? Is it a just in time (JIT) model that require little or no storage? I think we call that drop shipping now. How do you handle logistics? I think this is one area Nigeria falls short. Shipping is dependent on the country's existing transportation infrastructure. In the US for instance, the US postal service ships for Amazon. So Amazon really doesn't handle logistics.

Finally, what are you selling? If it's that important, people will buy ecommerce or not. I built an ecommerce for a friend. She sells weight loss products. She really didn't even need the site because she was already selling impressively. Infact, she rarely even remembers I built a site for her which really hurts my effort. But it just means the product is the most critical thing obviously. So think about this.

Marketing is key because you need awareness. She gets 80% of her customers through Instagram. So you have to check out all these issues. Are you a techy person and want to build the site yourself or a business man? Techy people and business and not usually clear on the business goals.

Finally, I think the ecommerce market in Nigeria is over exergerated. I can't remember the last time I shopped online. We think we have the volume to break even. This is how Jumia and Konga did themselves in. Maybe the volume is not that large but if you do your marketing right and do not invest heavily. You might be up to something. All the best.

Think about all these. The ecommerce site does not automatically lead to sales. The products and your awareness campaign does.

Yes, Marketing is key, couple with the fact that Internet penetration is still very low in Nigeria.

I guess building an offline store, using social media to drive sale will be a good option.

there are several logistic companies that can help handle logistics. like max, ace, kos etc..

cvibe2:


Don't forget Olx ran away, Konga ran away before it was bought by zinox computers(yudala)

lol..that is why investing in Logistics infrastructure (Delivery) and software optimization is key instead of in retail..you never lose.
e-commerce firms are losing money? no problem we (ie dropoff Ltd) are winning still. Amazon for instance are having too much shipment their in-house fleet can't cope and they outsource delivery...
Get onboard this ship guys, we are open to creative guys and also guys with cash for partnerships and association. (alphasapele@yahoo.com)

polimaf:
Yes, Marketing is key, couple with the fact that Internet penetration is still very low in Nigeria.

I guess building an offline store, using social media to drive sale will be a good option.

there are several logistic companies that can help handle logistics. like max, ace, kos etc..

icedbreez:


DropOff Ltd will be thrilled to partner with Mimi Nigeria. we are a startup with a global vision in "last 100 feet logistics"
Logistical planning is too big of a challenge for a company to handle alone. outsourcing your strategy to a last-mile company means that you can focus on your core business of making sales. the Challenge of Logistics is difficult and needs to be handled by a dedicated player.

DropOff is a startup that aims to serve as the courier and last mile delivery company of choice for e-commerce companies, Brick-and-mortar retailers, SMEs and documents deliveries.

sorry, seeing this late.

What are your coverage locations like?

Do you do POD? Nationwide or?

MimiShopping:
sorry, seeing this late.

What are your coverage locations like?

Do you do POD? Nationwide or?

DropOff is operational in Port Harcourt at the moment and hope to expand.
We are a last-mile and On-demand delivery start-up.

www.dropoff.com.ng
facebook.com/dropoff.com.ng
linkedin.com/company/dropoff-com-ng
sapele@dropoff.com.ng

hmmm

DaCharis2016:
Guys pls help, ideas keep hitting my big head big time, and I don't know what to do.

I can give your friend an idea that will catapult to millions annually, but my challenge is how do I monetize my ideas. Especially partnering with a sponsor?

I need advices from you all. If someone had idea that is going to be very profitable, what should the person do?

How do you know your ideas can catapult to millions when you haven’t tested it? You do know so many people’s have ideas and until you get started it remains an idea

I've learnt a lot from this thread..kudos to everyone who contributed

Well, for now, Nigeria is not ripe for Ecommerce. Don't say someone is doing it blah blah.
Jumia is not limited to Nigeria and they have their way of making things work for them. They are only running because they have projected by in few years things will become better.

If you want to know what it feels to be operating Ecommerce in Nigeria, then ask Konga.

I have given this analysis using the details you provided. However, if he wants to start in a small area, then the xx million may suffice and most importantly if he is not looking for profit till around 2 years time, it is okay to go in.

Gotten a lotta key points from this thread

So many points. A very educative thread

not with pay on delivery

Legendguru:
not with pay on delivery

that's one of the ways to survive in the game though you will incur losses but you'll make a decent net profit.

i have an ecommerce website. Though i dont have any of the products listed on it but i source for them and do a mark up on the products. I have tried marketing on twitter, facebook but the results are still low. i need solutions.

Good day, how are you doing today?

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adaperry25:
i have an ecommerce website. Though i dont have any of the products listed on it but i source for them and do a mark up on the products. I have tried marketing on twitter, facebook but the results are still low. i need solutions.

Did you later got a breakthrough in regards to your marketing

I was the one that just asked you similar question on your thread now where you said you are looking for a video editor

Thank you

Theophinio:


Did you later got a breakthrough in regards to your marketing

I was the one that just asked you similar question on your thread now where you said you are looking for a video editor

Thank you

Yea