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In recent years, more and more companies working in the field of e-commerce, are looking to expand into the African market. The region attracts investors to the rapid growth of technology, as well as the predominance of a young population.
However, many entrepreneurs who have already started to build Africa business related to e-commerce, have encountered difficulties and were forced to withdraw from the market.
Experts call the 6 causes of loss of internet business on the continent:
1. Distrust
Due to the proliferation of online fraud Africans still less trust your billing information online shopping. Risk to make electronic payments only to students and young people are often targeted at low-cost goods. Africans with incomes above the average are not willing to risk their online tools.
Online stores are trying to solve this problem by using the COD option.
2. Expensive Internet connection
Most Africans use mobile Internet. Mobile operators often offer to visit some resources, such as, Facebook, free of charge or for a nominal fee. However, access to most Web sites is quite expensive.
3. Logistics
US online shops built a system of delivery of goods to the existing extensive network of national post offices. In Africa, public postal services are unable to support the development of e-commerce. Therefore, retailers have to deliver orders on mopeds, which entails an increase in the cost of doing business.
4. Spontaneous trade
In African cities, spontaneous trade is normal. Unemployed young people are forced to sell goods on the street.
The problem of online shops is that they can not offer competitive prices to their customers, because forced to open a bank account, rent a room and pay taxes.
5. Fragmented market
Africa is not a single market. In forming the concept of online shopping should take into account cross-border payments, different languages, cultural differences and other factors.
6. The literacy rate
In addition to investments in infrastructure, online retailers are forced to invest in the education of the population. Because in some countries, such as Chad, Niger and Burkina Faso, the literacy rate is less than 30%.
However, many entrepreneurs who have already started to build Africa business related to e-commerce, have encountered difficulties and were forced to withdraw from the market.
Experts call the 6 causes of loss of internet business on the continent:
1. Distrust
Due to the proliferation of online fraud Africans still less trust your billing information online shopping. Risk to make electronic payments only to students and young people are often targeted at low-cost goods. Africans with incomes above the average are not willing to risk their online tools.
Online stores are trying to solve this problem by using the COD option.
2. Expensive Internet connection
Most Africans use mobile Internet. Mobile operators often offer to visit some resources, such as, Facebook, free of charge or for a nominal fee. However, access to most Web sites is quite expensive.
3. Logistics
US online shops built a system of delivery of goods to the existing extensive network of national post offices. In Africa, public postal services are unable to support the development of e-commerce. Therefore, retailers have to deliver orders on mopeds, which entails an increase in the cost of doing business.
4. Spontaneous trade
In African cities, spontaneous trade is normal. Unemployed young people are forced to sell goods on the street.
The problem of online shops is that they can not offer competitive prices to their customers, because forced to open a bank account, rent a room and pay taxes.
5. Fragmented market
Africa is not a single market. In forming the concept of online shopping should take into account cross-border payments, different languages, cultural differences and other factors.
6. The literacy rate
In addition to investments in infrastructure, online retailers are forced to invest in the education of the population. Because in some countries, such as Chad, Niger and Burkina Faso, the literacy rate is less than 30%.
