Omnibiz, a B2B e-commerce and retail platform located in Lagos that links producers of fast-moving consumer goods (FMCG) with retailers by digitizing supply chain participants, has secured millions to attract and keep retail consumers.
After managing the now-defunct VConnect for several years, Deepanker Rustagi founded the business in 2019.
According to Rustagi, the organization’s fresh round of funding will be essential to achieving these goals.
The B2B e-commerce business today announced that its $15 million pre-Series A round, which was led by Timon Capital and consisted of $5 million in equity and $10 million in debt, has been concluded.
Besides Ventures Platform, Lofty Inc., Chapel Hill Denham, Chandaria, and Musha Ventures, other VC firms also took part. These investors participated in the seed round of the business in some cases.
According to Omnibiz, the investment will be used to intensify efforts to win the loyalty of retail consumers and increase their retention.
Additionally, the business expects to start its regional expansion this month in the cities of Abidjan, Takoradi, Kumasi, and Accra as it mentioned during its initial round of funding last year.
Omnibiz uses a retail distribution model with minimal assets. Orders placed by retailers on the Omnibiz platform are fulfilled by partner distributors that store products on behalf of producers.
These distributors are typically known to assist with transportation and warehousing. With Omnibiz, these distributors can concentrate entirely on warehousing and delegate the task of product delivery to outside logistics companies, who then ship orders to retailers within 24 hours.
The business collected $3 million last August to enter new domestic markets. The network, which provides retailers with a phone number, a WhatsApp channel, and a mobile app through which they may stock their stores, has subsequently grown into 12 locations throughout Nigeria while also finishing its first Pan-African foray into Ghana.
In an effort to differentiate themselves, B2B e-commerce platforms around the region are driven by a variety of performance measures, including gross merchandise volume (GMV), the number of retailers, products, and SKUs.
In the case of Omnibiz, this involves optimizing for retailer loyalty, a puzzling aspect of B2B e-commerce that Rustagi believes his business has managed to exploit.
Companies like Omnibiz, which work with distributors to assist retailers to acquire their products, whether they are the quickest SKUs or sluggish ones that serve as replacements, in one spot whenever they require them, are pushing ease in addition to having competitive pricing.
Rustagi claims that by helping its retailers in various ways, such as by taking an interest in their long-term growth, offering working capital, and managing their storefronts and foot traffic, Omnibiz has improved retailer loyalty.
This tactic is driven by the platform’s bookkeeping tool, the MyStore app, which competes with Kippa, Pastel, and OZÉ and enables businesses to manage their users, inventory, and access BNPL services.
Rustagi adds that because the platforms are frequently not connected with their procurement, retailers find it difficult to manage bookkeeping solutions in Africa.
For independent businesses, the amount of effort involved in bookkeeping is therefore burdensome unless they gain from doing so; as a result, that’s where the MyStore app comes in, he added.
In addition to the main Omnibiz Retail app, the MyStore app enables the business to pursue a comprehensive strategy to become the main B2B operating system for retailers, providing them with operational tools for tracking sales, costs, prices, and profits as well as last-mile delivery, procurement, working capital, and inventory management.
According to Rustagi, Omnibiz launched the MyStore app last July to serve shops that are “faithful” to the platform.
More than 3,000 of them exist. In comparison to medium-sized major sub-Saharan African firms like Marketforce, TradeDepot, and Wasoko, who report multiples of that figure, it is quite little. But there are certain subtleties in how Omnibiz calculates traction.
These 3,000 shops, known as “active daily merchants,” make orders on Rustagi’s platform every day, as opposed to other competitors who might give a more generalized representation of enrolled merchants.
Techbuild’s Take
Entrepreneurial ambitions for e-commerce are shifting to selling online while online retail platforms in Africa struggle.
Although B2B e-commerce has promise for digitizing Africa’s massive offline and informal economy, there are still obstacles to overcome.
Investors and business owners are growing ever more enthusiastic about B2B e-commerce as they realize that street sellers with busy operations are more trustworthy customers than the infrequent online consumer.
Regarding Omnibiz, the business uses a retail distribution model with few assets. Orders placed by retailers on the Omnibiz platform are fulfilled by partner distributors that store products on behalf of producers.
These distributors are typically known to assist with transportation and warehousing. With Omnibiz, these distributors can concentrate entirely on warehousing and delegate the task of product delivery to outside logistics companies, who then ship orders to retailers within 24 hours.
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