When most people think eCommerce, they think of a website or an app. But that’s essentially a highly simplified version of what it truly is. In truth, eCommerce is about the technology that empowers the front end and the backend, supply chain and last-mile delivery.
There has been much criticism publicly on the failure of eCommerce by the larger companies in Sri Lanka in groceries. This criticism is largely fair. One of the reasons for their failure to execute eCommerce during the current crisis is that they were unprepared to handle eCommerce on a large scale.
eCommerce requires a clear strategy, investments, and execution. None of which were present. Only now are we seeing some level of operational activity happening at a regular interval, but as a very rudimentary type of operation at best. In terms of our experience at Takas, in terms of eCommerce operations, you cannot simply go buy a solution to solve the problem.
You need to have a thorough understanding of how eCommerce works. Primarily, the front end (website/app), the back end (technology that keeps the site going, as well as get data needed to fulfill orders) and last-mile delivery (getting products to the end consumer). This is especially difficult when it comes to selling groceries online.
Selling groceries online, in particular, is a complex challenge. Inventory has a fairly short shelf life. The supply chain, therefore, is critical. Unless it’s finely tuned, your margins will be wiped out. Worse still, your inventory could go to waste.
Other than the above-mentioned challenges, there were 3 main challenges we at Takas faced. To our advantage, since eCommerce is our core strength, the technology was not a challenge for us. We knew how to keep our site operational and take orders, despite the heavy traffic on our site.
The 3 main challenges are:
- Delivery partners – who received curfew passes to make deliveries? Luckily for us at Takas, we had a good relationship with CityPak (Hayleys) and they came to solve this problem.
- Working capital and suppliers for essential items. We managed to come to an agreement with Ideal Group that initially helped us with both these problems
- Curfew passes for senior management.
Once we overcame the above 3 challenges, Takas pivoted to get groceries to consumers. Thus far, it’s working well and now we are expanding the range as well as the areas covered. The key to this was to use our technology, team, and the network we had to solve a pressing problem to the consumer, and for us, this is how eCommerce works.
eCommerce is a very hard game, as many of the larger corporates are now realizing. But in the world of corona, it will be one of the only ways any company can engage with the consumer in a meaningful manner. As pointed out by economist, Deshal de Mel, eCommerce has been identified as one potentially positive sector in Sri Lanka among others such as fintech, last-mile delivery, export manufacturing, and technology at large.
Thus, investments into eCommerce will be needed, so the current/new players can play a more meaningful role in serving the consumers and the public. What is 100% guaranteed is that B2C companies who do not master eCommerce in the next coming weeks or months will most likely not continue their business into 2021.
Disclaimer: The author is a co-founder of Takas.