By Soumaya Hamzaoui, Co-Founder and COO of RedCloud
Global commerce has undergone a significant transformation in the past decade. While online retail giants such as Amazon and Facebook have thrived in the digital trading landscape, they have also marginalized smaller competitors in emerging markets and developing economies (EMDEs).
This has led to an unjust playing field, with Amazon alone commanding 37.8% of the retail ecommerce market in 2022, according to Statista. By limiting access to essential goods and establishing their own distribution networks, these industry behemoths are constraining the supply lines and trading capabilities of millions of retailers and distributors.
Furthermore, they are depriving them of crucial data required for a more efficient trading system, leaving smaller businesses to operate without valuable insights for effective product distribution.
Limited Options with Cash-only Transactions
Restricted from ecommerce access, these businesses are compelled to continue trading exclusively with cash, presenting various inefficiencies and limitations.
The use of cash transactions is slow and costly to handle, particularly at a time when companies seek to minimize expenses and maintain operations within challenging trading conditions.
Moreover, the lack of access to traditional banking and finance prevents these enterprises from establishing a trading profile, making it impossible to obtain necessary finance for business growth. This, in turn, hinders their ability to thrive in the market.
With no access to digital trading, these businesses lack crucial customer data and are forced to rely on inefficient and outdated offline supply chains, making them vulnerable to external disruptions.
Empowering Through Open Commerce
Granting these traders access to an open commerce platform can transform the game. Embracing digital banking and trading online presents a multitude of opportunities for them.
Transitioning away from cash transactions can mitigate risks such as fraud and theft, while enabling greater operational efficiencies through digital payments. Real-time data allows for improved demand forecasting, inventory management, and the implementation of targeted digital marketing campaigns.
Access to such insights empowers businesses to adapt to market trends, enhance product offerings, and optimize overall supply chain efficiency while expanding their customer base globally.
A New Path for Ecommerce
Incorporating digital trading capabilities with their established credibility and customer trust, small businesses can leverage new opportunities and expand their global presence to compete effectively in the market.
By breaking the monopoly of online retail giants, it’s essential for EMDE businesses to harness digital trade and ensure fair participation in the global trading arena, especially with estimates projecting retail ecommerce sales to reach $8.1 trillion by 2026.
About the author
Soumaya Hamzaoui is the Co-Founder and COO of RedCloud Technology. With a decade-long background in software and telecommunications and extensive experience in product management within financial services, she has played a pivotal role in developing innovative solutions, including Orange Money in Africa. Her expertise has significantly impacted the transformation of industries such as banking, transport, and telecommunication towards new technologies.
