(Bloomberg) — Nigeria’s biggest consumer-goods companies have signed an agreement with e-commerce platform Omnibiz to boost sales and curb costs after Covid-19 lockdowns and smartphone use triggered a boom in online trade.
Omnibiz, a Lagos-based fintech company, has signed up more than 12 firms operating in the country — including Coca-Cola Co., Nestle SA, Kellogg Co., Unilever Plc and Procter & Gamble Co. They will use the startup’s platform that helps firms track sales from distributors to retailers.
Transactions on the firm’s Mplify product have hit $360 million, Omnibiz Chief Executive Officer Deepankar Rustagi said in an interview in Lagos. “The target is to grow it to $600 million by next year,” he said.
The opportunity for Omnibiz is to digitize the $1.2 billion annual local revenue of its new clients, which makes up about 3% of Nigeria’s total fresh produce and packaged foods market, according to data from KPMG.
Last year, Omnibiz raised $3 million in seed funding. The company plans to raise about $12 million more this year to further develop its software and expand into about five countries in sub-Saharan Africa, according to the CEO.
In Nigeria, Africa’s largest economy and most populous nation, most products are distributed physically, passing through informal or traditional channels like warehouses, markets, malls and kiosks. The coronavirus pandemic and lockdowns caused a shift, not only in distribution, but how people worked, learned and more importantly shopped: going online.
E-commerce platform Jumia Technologies AG, which has Nigeria as its biggest market, reported a 40% increase in total orders and 29% jump in active users in the 12 months to December across Africa. The pandemic also opened an opportunity for new digital payment apps like Kippa to enter the consumer digital payment space.
“The manufacturers are making more revenue because they are able to see the movement of their goods and can increase the supply at a lower cost,” said Rustagi. “We are in the business of making retail simple.”
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