B2B Marketplaces Tackle Africa’s Supply Chains

Online marketplaces are among the defining features of contemporary eCommerce, which has been shaped by the likes of global heavyweights such as Amazon and eBay.

But just as direct-to-consumer retail has been transformed by the marketplace model, the world of wholesale and commercial trade has also embraced digital platforms.

In fact, some marketplaces like Amazon operate both business-to-business (B2B) and business-to-consumer (B2C) services. And long before the launch of cross-border B2C platform AliExpress, Chinese eCommerce giant Alibaba was connecting suppliers to an international customer base of businesses.

Aside from general-purpose B2B eCommerce solutions, there are also platforms that cater to a specific market. These include the growing number of African marketplaces that have stepped up to meet the unique needs of the continent’s businesses.

Related: FoodTech Investments Help Streamline Africa’s Agriculture Trade, Connect Fragmented Supply Chains

B2B Solutions for African Commerce

The most recent entrant to the space, Dooka, is looking to streamline corporate procurement and promote intra-African trade by tackling supply chain inefficiencies that have inhibited growth for the continent’s businesses.

Designed specifically for large enterprises operating in Africa, the firm differentiates itself from other B2B marketplaces that have been built for small and medium-sized businesses (SMBs).

These SMB-focused firms include companies like Egyptian firm MaxAB, which has built a digital marketplace where small supermarkets and grocery stores can purchase food directly from wholesale suppliers, and Wasoko, which helps distribute consumer goods to a network of 50,000 informal retailers in its network across East and West Africa.

At the SMB end of the spectrum, the challenges faced by buyers tend to be a lack of access to a wide choice of suppliers, inefficient distribution networks and a high dependency on cash-based transactions.

As Daniel Yu, CEO and founder of Wasoko, explained to PYMNTS, “we still primarily collect payment on delivery, and the majority of that is actually still happening in cash. [That] is a reflection of the fact that informal retailers operating local communities do largely still serve their consumers through cash.”

Watch Yu’s interview: African B2B Marketplace Wasoko Takes On Supply Chain Inefficiencies

At the enterprise scale at which Dooka is operating, however, businesses face a different set of procurement challenges.

With supply needs that pale in comparison to the demands of small retailers, Africa’s largest businesses can struggle to build relationships with local producers who aren’t necessarily set up to fulfill enterprise-level orders. As a result, buyers often default to dealing with other large organizations that are better prepared to meet their demands, even if they would rather deal with local sellers.

To address this problem, Dooka does the work of vetting and onboarding local suppliers, meaning that buyers can purchase from smaller local businesses just as easily as they can from multinational corporations.

The Africa-focused firm has also tapped digital supply chain solutions company Tradeshift to help create an eCommerce environment that is targeting buyers at the top of the food chain.

To demonstrate the kind of businesses that can benefit from the new marketplace, Dooka recently announced pan-African telecoms giant MTN Group as its first enterprise client.

Read on: MTN Partners With Dooka for Digital Supply Chain Solution

Commenting on the partnership, MTN Group Executive and Chief Procurement Officer Dirk Karl said Dooka “brings efficiencies to every level of the supply chain” and that the firm “stands to transform the way businesses operate across Africa.”

Ultimately, Wasoko and Dooka are tackling a similar problem from different angles. They are both using the B2B marketplace model to address Africa’s supply chain inefficiencies by removing unnecessary middlemen and connecting buyers to a greater range of more affordable products.

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