The key success factor of e-commerce in Algeria

E-commerce is a mode of distribution that tends to become more democratic, everywhere around this model many startups in the world have managed to digitize services that often already cohabit in the real world. At the same time, traditional distributors have naturally invested in this model, relying on an existing industry, an efficient supply chain, digitalized means of payment, technology and connection solutions that meet the needs.

In Algeria, many companies, distributors, producers have also adopted this distribution model and therefore many players have invested in the transport sector to support these new e-merchants. Very brave, ambitious young people with a highly developed entrepreneurial spirit and a startup culture. They quickly understood that there was a market and that they had to go now. In fact, this logistics market already existed in an archaic, underground way, in the form of grouping of goods, allowing the transport of various products from Algiers and other large cities in the country, to the east and south, east and west regions. The more or less efficient and organized craft-carriers based in Hamiz, in particular, have been able to weave nets for years that offer the possibility of sending a package from 150 DA over a distance of more than 500 km! It is clear that the conditions of sending and receiving are not ideal for B to B and in general to guarantee a sustainable quality service and especially home delivery in B to C. Likewise, for the bus and taxi network that also offer very fragile groupage solutions, but which represent a serious alternative for individuals and traders, in the absence of a better solution. Unfortunately, the ecosystem, the maturity of the players and their customers, did not allow this sector to develop. No investment, or very little, no long-term strategy, lots of patching and temp work that lasts! Even though, even so, some have become a reference and remain very credible, such as Sekfali, Kazi tour…

Unlike in developed countries, when E-commerce was imposed as an inevitable distribution model, groupage transport was already very efficient and very profitable, it was enough to integrate the last kilometer and home delivery for individuals. In Algeria, it is not so! Carriers have to rebuild everything from the ground up: last mile, home delivery, service desk, everything has to be done! In a market where the price battle is fierce, where investments are very important to multiply the hubs, to provide transport equipment, which is otherwise unavailable, all this accompanied by a chronic lack of financing. Race results: Mediocre performances, a real mess that sets in. The risk is to see a new generation of companies, similar to the previous ones, establish itself in proximity and disorder.

In this confusion, the first three players in this new market, ANDERSON LOGISTIQUE’s E-commerce LOGISTICS department, launched two years ago, Easy Relay and Yalidine, offer relatively modern services and are making considerable efforts to structure and adapt to the same problems as others. In fact, the concerns of e-merchants are numerous. First of all of a financial nature, the cash delivery time, which represents 99% of the revenue collection method, can take up to more than a month for regions, with all the risks of manipulation arising therefrom. Very high rates of return, which often approach 50%, incurs additional costs. The level of insurance coverage, almost nil. Delivery times outside wilaya, very slow, in a sector where everything happens very fast, where the customer can also change his mind very quickly. Finally, the informal makes things even more complex, as most e-merchants are located in this economy. These companies weave their web throughout the national territory, with their own hubs in large cities or with serious partners, they consolidate regular shuttles to connect the main warehouses, bring together transport teams to guarantee home delivery, secure transactions, establish rules and codes to allow better coverage of risks related to damage and theft, configure information systems interconnected between all the protagonists of operations, including e-merchants. Investments are very important, in terms of funding and human resources, but that’s another problem!

The future of this sector largely depends on logistics, the stakes are high for transport companies. Change is inevitable to adapt to new consumption patterns. Digitization of carriers, loading optimization, use of an integrated system linking logistics to web merchants. This transformation could allow the transport sector to change and succeed in imposing groupage as the universal “model” in our country. The first to succeed will sustainably control this market and ensure its supremacy.

Entrepreneur

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