In this interview with BusinessDay’s PATRICK ATUANYA, MIKE DOLA, Founder and Executive Director, cokodeal.com, sheds light on the technology firm’s innovative disruption to the Nigerian e-commerce space. He also articulates the company’s value proposition for creating market linkage without the need for a middleman and boosting made in Nigeria goods especially for exports. Excerpts…
Tell us about your company and the value proposition it brings to the market
Cokodeal.com is an e-commerce firm for locally produced goods, manufactured goods, textile, agricultural products and crafts in Africa. It was created from a desire for a continent that will not be at the mercy of foreign assistance but a convergence point for global trade.
Nigeria as an entry point into Africa has shown it has more than enough to sell to the world. In our market exploration we did understand that there were thousands of local manufacturers unknown to Nigerians, we found out there were popular brand in South East Nigeria but hardly found in the west, hence we saw a need for us to connect South-East Nigeria with the South-West, with its vast production of locally made commodities like shoes, bags, plastics, furniture frames and more; Northern Nigeria with the South-East with its huge volume of leather works and hides; and the South-West with the East, with its farm produce, cocoa, and raw foods. Hence, for cokodeal.com to create a market linkage to other African markets to improve intra-Africa trade and finally to global markets to boost Nigeria exports. It is only through digital ubiquity that cokodeal.com can create this kind of complex connection quickly and effectively.
Our value proposition is to create a market linkage without the need for a middleman or huge advertisement cost for the hardworking woman in the Far East to tell the world what she produces and to get buyers from a global pool for her locally made shoes in Nigeria for free. For her to be able to sell at wholesale not once, but many times over to the buyers’ cokodeal platform links her with. This applies to local manufacturers, indigenous farmers, and mineral miners and craft creators.
Also, we promote our own creation to Nigerians, “Made in Nigeria” goods for us to patronize at all levels from individuals to government. Our promotion showcases locally made goods in Nigeria to Nigerians and the world at large. As reports says, the number of small-scale shoe industries for footwear made in Aba is about 10,000 and they record an average of 1 million exports daily according to the president of Abia think tank Association, Mazi Sam Ohuabunwa. With sites like cokodeal.com platforms to expose and promote the capacity of the manufacturers, demand can soar higher and exports can improve exponentially.
What model would you say your business best exemplifies, is it Ebay, Amazon, Google or Ali-Baba?
Alibaba.com. Yes cokodeal.com positions as an Alibaba for locally made goods in Africa to sell to a global market. As we all know, Alibaba was created to connect China manufacturers to the world and the result was staggering, with over 16million Chinese small scale businesses, trading in over 240 countries, this is the simple reason why made-in-China goods have penetrated all nooks and crannies of a major part of the world. A similar solution is what cokodeal.com is doing in Nigeria and Africa at large. In a span of a year cokodeal.com has received welcoming testimonials from successful traders on the platform as we aim to grow across Africa.
What has the uptake been like from businesses?
Initially we needed to educate most businesses how the business model works, that it is not home delivery and pay-at-your-doorstep, nor old traditional methods, instead it is a medium to get interested buyers for your businesses, that you can sell at wholesale to, which is facilitated between seller and interested buyer. After our strategic marketing team went out to speak with business owners, we were made to understand their joy comes from a demand driven business, meaning they have more buyers than they can supply which gives them more energy and enthusiasm to produce more and increase production. In view of this our ultimate goal is to find buyers for our clients for them to sell more over many times.
With our improved search optimized site more businesses have begun to get more calls from as far zone as Europe, Cameroon and other parts of Africa to place large orders for their goods like Ginger, cocoa and shoes.
Many businesses still do not understand how the technology works because of an old man that heads it, doesn’t see reason why he needs to change what he has been doing for over 20 years of trade. Moreover, we know the best people to explain are the proprietors of successful businesses on our platform, using word of mouth. Therefore we do more of face-to-face marketing to educate users than online campaigns, because if we can create success for one happy client, it is more successful for us than having huge volumes of unsatisfied clients as we aim to be in business for the next 103 years.
How do you manage your website against down time and hosting issues as well as IT security for customers?
We have a robust software development team with over 11 years’ experience in the United Kingdom, they manage all information related to the site to ensure a global parallel standard for an e-commerce marketplace of such size. Cokodeal.com platform is hosted on a private server with 99.99% uptime, with a standard secure socket layer technology acknowledged as industry standards for security and encryption to protect our customers. We also actively monitor all activities, for traders and deals on the site to protect our customers.
Tell us about your relationship and partnership with manufacturers association, government agencies and the bank of industry (BOI)?
We have begun collaboration with Manufacturers Association of Nigeria, Nigeria Association of Small Scale Industries and Nigeria Exports and Import Bank. Their involvement will fast-track our joint success as we will help their members become more successful in business, also giving us the local knowledge support to help us reach their members through the umbrella body as it is difficult finding businesses across all corners in Nigeria. For BOI we are yet to have a form of partnership with them, however we seek a collaborative work with BOI to enable us reach deep markets and support structures in all form it may come.
From your finance projections, Cokodeal.com should break even at the end of its first year of full operation, and stay liquid with 120% increase yearly, how do you intend to achieve this?
Thank you. Our business model structure is quite lean in its operation, due to the knowledge that the robust e-commerce platform handles most of our operation thereby creating lower overhead costs for us, like big warehouses, big logistics cost and a lot more. Having this information helps a finance planner to understand our major asset is in our platform and the database pool.
Our basic revenue model is in the seller’s subscription and advertisement on the platform and series of other build up revenues like agents, franchise and export brokerage. For us to achieve projected financial plans, our revenue structure of monthly subscription and advertisements both from our clients and external organisation will leave us with an above average return that will yield 120% yearly increase after the first year.
How do you intend to handle logistics between buyer and seller or is that going to be outsourced?
Our ultimate goal as mentioned earlier is to move our client businesses to new markets where huge demand for their goods can be achieved, for them to get interested partners, investors and volume demands. In this vein, we do not intend to handle logistics directly for now until a later time when there is a better network of transportation within Nigeria and across some major commerce zones of Africa. However, we outsource logistics to third parties logistics companies by ensuring best deals for our clients and easy access to know what logistic company is best for them and why.
We will be getting our clients loads of interested buyers, guides to safe trade and monitor all their business dealings through our tools. Ensure they get enlightened with industry best knowledge from our partner association. However, business will carry on as usual between traders and buyers.
Some of the advantages we offer are to inform and invite our clients to trade fairs, trade expos, exhibitions, and trade event network. This helps them to understand what buyers are looking for as regards to quality of goods, the best method to create a superb packaging for their products, and expose their businesses to opportunities such events presents as recorded by Nigeria Export Promotion Council (NEPC) that international trade fairs and exhibitions in the year 2013, 13 of such outings were spearheaded by the council. A total number of 126 companies, mainly Small and Medium Enterprises, benefited. On-the-spot sales and orders generated by these companies amounted to $627,108.23 and $3,716,920.51, respectively.
How does your platform benefit businesses specifically like saving them money or improving their business?
Technology in this modern age is critical to exponentially scaling revenues and cost reduction, literally fastest and cheapest way of doing everything. Cokodeal’s goal is to improve the wellbeing of Nigerians through trade. How do we achieve this? For a trader in times past to reach a large audience nationally, he may have to go on television, radio or print media to place an advertisement for a day which costs a fortune for the business owner. However with cokodeal.com business listings method through its optimization, business can be seen across the continent at a rate almost as free within days, and the business can be searched for daily over a long period at no extra cost just by been listed as a business on cokodeal platform. With this concept we save the trader money.
We have also observed that local traders, due to limited trade knowledge, middle men continuously rip them off their gains, with our easy to use website, local traders can be connected directly, through his business details added on his own individual store on the platform, therefore totally removing a need for a middle man, which allows the trader to command a good return for his goods, which makes his life and family wellbeing better off, by receiving a profitable return for their yield. With this we help them make more money.
Lastly, with this connection, business can reach new markets that they can charge higher prices for their goods since it not only traded locally within the local economy, thereby bringing in more profitable return for traders. Hereby we helping them grow their businesses and improving brand exposure.
Tell us about your operations and what part of the economic social issue you aim to address
Basically our operation deals with registering businesses on the platform, giving them the technical knowhow to improve their trade and inviting them to trade shows, other parts of our operation is a little bit technical, dealing with more of technology requirements. Cokodeal.com aim is to absorb 10,000 unemployed youth into the work force using a simple model. When I was watching the interview of the selected Nigeria minister’s nominee, it was observed that one of the germane questions being asked was the engagement of the large pool of work force to get them engaged. This poses to be a big challenge for the nation. Here is our simple model, it comes in 3 phases. However before I begin, I may need to re-define employment as a means to have a basic income to cater for your needs and wellbeing not as a form for you to wear a suit and sit on a leather chair as a white collar worker.
Firstly, we see a need to connect youths with factories and agricultural farms, jobs ten people do can be split to forty hereby splitting the wages over many people and government give such businesses incentives, because an income is better than none, its better we cut down our luxuries. Secondly, drop-shipping is a fast way of becoming rich in the internet age, we engage lots of youths to partner with factory that do not have time for internet work to create free store on cokodeal.com, so the youth acts like the factory agent, when there is an order, he facilitate the deal and gets a fat commission because of the volume of trade. And finally we are presently hiring youths across different region of each states to manage the region trade activities.
E –commerce is booming in Nigeria, however you are not a first mover, as there are some similar platforms to yours in the market. How do you intend to overcome competition?
Cokodeal.com is first to its niche, solely dedicated to local produce promotion and exports. We do not intend to compete directly with major ecommerce presently in the market that are more dominated in retail of imported goods and some local goods. We are focusing on local manufacturers, agro trader and local crafts wholesale and exports.
You mentioned local exporters, what impact can Cokodeal play in the diversification of Nigeria?
Cokodeal.com as Nigeria’s largest non-oil export trade platform aims to amplify the government goals at an exponential growth rate by, creating the fastest means for exporters to connect with global buyers and for easier trade within the nation. As we know, the old industrial way is a slowly dying animal; this technological breakthrough will break down barriers and boundary of trade across many countries.
With cokodeal.com we believe we can achieve tenfold growth for industries, manufacturers and small scale traders when the market is ripe. Cokodeal.com is Nigeria’s biggest promoter of made-in-Nigeria brands, we believe in the nation’s handiwork and proceeds. We cannot continually encourage flooding of our nation with imported goods that barely do any good for our economy. For our GDP to increase and wellbeing of our people, we may have to focus more on what can we do for the world than what we can benefit from the world, as a non-shortsighted goal for the economic benefit of a few, instead we have to focus on economic development not for the short term, but for a long term and national development for the unborn children.
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