Interview: e-commerce in Uganda, the story as told by Kaymu

Jusin Christianson MD Kaymu Uganda

Just the mention of “Downtown Kampala”, paints the image of plazas well garnished with shops selling a cross section of items. Its home to the very familiar St. Balikudembe market (Owino). In short, Downtown Kampala is the place to go to when you need to shop.

I met Justin Christianson; Country Manager Kaymu Uganda at their Downtown offices. Kaymu Uganda is an Internet upstart that is keen on leading the e-commerce game in Uganda. Justin does not think that these plazas should be filled with people as they would easily have access through the comfort that technology avails them: on their computers and mobile phones,all with out going to a single shop.

The end game would be, empty malls, leaving us with one big plaza, a virtual one at that: Kaymu! — or maybe — I am just getting too ahead of myself!

Here is the full interview with Justin, Kaymu Uganda’s Country head.

Jusin Christianson MD Kaymu Uganda

Justin Christianson, MD Kaymu Uganda

What is Kaymu?

We are an e-commerce company, we are a bit different from what people immediately think about e-commerce: Amazon, Alibaba. We are different in that we are a platform that links buyers and sellers, unlike an Amazon model, we do not own the products. Most of our sellers are located here, “downtown”. So we market their product online and ease the delivery, once a buyer is interested. If the two parties decide to handle it on their own, we step back and facilitate the transaction. So this is our approach, Jumia is another player, and theirs is an amazon model where they own the product.

 

 You mentioned Jumia. Kaymu and Jumia are under the same ownership, aren’t you competing with each other?

We compete in some sections, because in the end, we are all different channels for buying things on-line. Jumia as I said own the product or they deal with specific distributors that have as I could say “more professional” channels of distribution. Kaymu represents about 6,000 sellers and these range in different sizes and product offering, we have 60,000 products on our site while Jumia has about 4,000. We are therefore never going to have a warehouse for 60,000 different products.

 

So what works for this market, the Jumia or the Kaymu way?

We are still definitely learning, the buyers and sellers are learning as we grow together we are going to refine our process, so any buyer that goes downtown has a certain experience that they would expect: say finding out about price, how legitimate is the product comparing different products and sellers. It’s the same with using our site. The more you know how to navigate the site the more you can know what to expect from the sellers, and have a more enjoyable experience! I’m not saying that people should figure this out on their own,  we are here to teach. To teach our buyers and sellers.

 

Give us your insights into the Ugandan e-commerce market.

To step back a bit. We didn’t invent e-commerce, however it is relatively new here in Uganda. It’s not something were we can just set-up the website and walkway because in all market places you have to localize and cater to the local taste. We have been in the country for a little under a year. Kaymu global group started in Nigeria in 2013, Kaymu Uganda started in March 2014. We have gone from zero orders a week to a thousand orders, Over Christmas season we had 1,500 orders a week. Zero sellers to 6,000 orders sellers now, we have 60,000 products on our site. We aren’t the first e-commerce platform  in Uganda, but we are one of the first and we are the first to do it the way we do, and ours is a hands on approach.

 

What challenges are you facing?

First and foremost the biggest challenge is Education. So if everyone, in particular the sellers would understand how the system works and how to get the most out of Kaymu then everything would work more smoothly: for example updating their stock explaining to people how to get the most out of the site. Is the biggest challenge, and we are beating this through sensitization.

Ssalango Kiwalabye Shoe Seller in Mukwano Arcade Using Kaymu

Mr. Ssalango Kiwalabye Shoe Seller in Mukwano Arcade Using Kaymu  (“At first we sellers were very suspicious about these people picking up our goods with a promise to pay later, but after working with Kaymu. We now trust them since they help improve on sales volume, they also give rewards to sellers!”)

What partnership does Kaymu have with MTN?

Kaymu is part of a group called the Africa Internet Group: Africa Internet Group is continental group that works towards Internet-based business. MTN is one of the primary investors in Africa Internet Group, other investors are Tigo (a Telecom not in Uganda but present in other countries on the continent), and Rocket Internet, a venture capital firm based in Germany.
Because of that we are able to work very closely with MTN in launching mobile money, cross marketing, and very soon we shall have an MTN shop on the website!

 

Do you consider Kaymu a Startup?

Absolutely, in a lot of different ways, it is a start-up in the essence that its less a year old we are a very new company, start-up to me is about the culture, what goes into the challenges we face,we are still working out these different strategic approaches, we are still trying to understand our business, we are still starting out the business and understand how to make the most of it, the same goes to the employees we have, every one is here to explore the whole thing. We work really hard, and enjoy what we do as well.

John Baptist Kaymu Delivery Specialist, picking up orders from seller

John Baptist Kaymu Delivery Specialist, picking up orders from seller

Tell us about the team you work with

We are about 40 people right now, having started from zero back in March last year, we are a very young company too! I am one of the oldest people: 30 years old. Which is good for the type of business, no one is ingrained in old ideas, everyone here is learning something new, it is a very energetic closed group, you can see that in the way they go out and interact with the sellers, and interact with buyers on the phone, and I credit our success to that.
Outside of Kaymu Uganda, we are also supported by a central team, the central team is spread out four locations: Portugal, Morocco, France and Nigeria. The central team support the Kaymu global effort through technology: for example the Facebook ads, Google Ads– I’m sure many techjaja readers have seen them. One question I get a lot is “How safe id the site”, first of all we don’t get a lot of personal information: Credit card information. That aside, all of our technology is developed by world class developers, we have strong IT system that runs 30 countries, not only Kaymu Uganda. We are rated the safest way to do business on line.

 

So how much do you charge per transaction?

As I said earlier the way we are setup, it is a win-win situation. The first person who wins is the seller : if the buyer is not happy, the seller is not selling any goods, that means we are not going to be making any money. Right now we are don’t charge any commissions, if the seller wants to use our site we do not charge any registration fees too. Some people get so skeptical of that, but the reason behind this is that we want people to see value behind the service before we can ask them to pay. In the future we wont be charging the buyers anything outside the delivery fees, we shall also be charging the sellers a commission based on the product.

 

What is unique about Kaymu?

I think the fact that we care so much. For example, we have a team of 20 people that works just for sellers: explaining to them what the site is, showing them how to manage their stock. We have invested a lot in this and the fact that we really care about making this work: Education on the sellers and the buyers side, taking care of deliveries and returning the goods in case the buyers are not satisfied with the product.

 

I personally would wish for a more seamless payment method and I consider this a challenge, any plans to circumnavigate around this?

As I mentioned earlier, right now its a cash on delivery model, through our partnership with MTN, we shall have a full API integration on the website, that will help how to make payments on the website using mobile money. Right now though we have a payment system that fully works. So if you want to buy something say an iPad on Kaymu, you would place an order. Then we send emails, SMS and always call to confirm the order, once we have confirmed with the seller about the availability of the product, we send our delivery guy who picks up the product from seller and calls the buyer to confirm where he is, and delivery is done wherever he is. If the buyer does not want the product the buyer will have an option of saying no to the product.

 

Aren’t the costs per transaction higher than the revenue? (for that particular transaction)

Absolutely, this goes back to what we are trying to get this thing kick started and demonstrate show the to the buyers and sellers that it works. A lot of these additional tasks will be taken on by the sellers and we are already seeing this happen because they are the ones to benefit from the sale. We shall also be charging a commission that will vary according to the the product and this will cover our costs as we scale and increase our order volume.

 

When do you anticipate the mobile integration to take place?

Over the Christmas holidays we did live testing with MTN using our site, there were a few bugs that we worked through. So I say over the next month or two. It will be 100 % operational.

 

What is the future for Kaymu?

If you ask anyone, e-commerce is an undeniable force, even in Uganda people are starting to get a hold of it. We at Kaymu are going to lead this e-commerce revolution in the country. We have invested a tremendous amount of money into the country. Right now we do not collect any commissions on our transactions we even subsidize our delivery fees, the reason we do that is that we are trying to build up trust, we are trying to build up momentum behind this e-commerce push.

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