Digitizing informal FMCG distribution in Africa: why Partech is partnering with TradeDepot
By Cyril Collon and Tidjane Dème, Partech
At Partech we are strong believers in the potential of digitizing the informal economy in Africa. We are convinced that digital platforms will support a massive transformation of many still informal markets thus enabling growth across all layers of society.
So, when we met the founders of TradeDepot, we were hooked and immediately convinced by their vision, strong understanding of the market and their ambition to transform the industry.
While African markets are truly diverse, some common themes do exist. FMCG distribution faces similar issues across the continent and generally speaking all emerging markets:
- Brands, importers and manufacturers lack visibility and control over their own distribution channels (pricing, marketing, stock management, promotion);
- Distributors suffer from price discrepancy, running out of stock and inefficient logistics when they manage the delivery;
- Small informal retailers which represent 98% of the market spend a significant amount of their time managing fulfilment and grappling with the lack of access to capital.
We have engaged with entrepreneurs working on these issues from West Africa to Kenya and South Africa and found many very interesting models. When we met Kachi, Michael and Ruke, we were quickly convinced that TradeDepot’s approach was the right one. A full distribution platform addressing the needs of all players from brands to retailers, integration with existing platforms (i.e SAP) and partnership with distribution players to support their development: with this recipe, TradeDepot is well positioned to become an African leader in that market.
Kachi, Michael and Ruke have bootstrapped the company so far and have accomplished a lot on their own. Their strong execution, bold product vision and deep industry expertise have thrilled us and immediately convinced us to partner with them. This clearly resonates with the types of companies we aim to support in the coming years with Partech Africa: extraordinary entrepreneurs who leverage tech to solve pan-African problems. We are proud to be the first investor to join them on this exciting journey.
TradeDepot is a potential game changer in the industry and we couldn’t be happier to have it as the first investment of our Partech Africa Fund.