Nigerian-based B2B platform poised to start operations in Kenya

“In Kenya, Omnibiz will compete directly against Twiga Foods, Copia, Wasoko and Marketforce. There are also smaller players including Tushop, social seller Kapu and foodservice B2B buying app TopUpMama as well as online retailers Jumia and Glovo, for whom Kenya is a flagship market,” Trendtype said.

While the informal retail sector has typically supplied most consumer goods to African shoppers, traditional supply chain inefficiencies and the rapid growth of internet and mobile phone-based technologies have created a gap in the market.

This is being utilised by market-disrupting B2B e-commerce platforms to more efficiently connect multiple FMCG manufacturers to large numbers of on-the-ground retailers by digitising the supply chain process.

Among the big FMCG companies to embrace this approach are Coca-Cola, Unilever, Kimberly-Clark and Kellog’s.

An asset-light retail distribution model

According to the technology news website TechCrunch, Omnibiz operates an asset-light retail distribution model. When a retailer places orders on the Omnibiz platform, the goods are requested from partner distributors (traditionally known to help with warehousing and transportation) who store goods on behalf of manufacturers.

“With Omnibiz, these distributors can focus solely on warehousing and pass on the responsibility of transporting goods to third-party logistics providers, who distribute orders to the retailers within 24 hours,” TechCrunch said.

In an interview, Nikos Katsaounis, a partner at emerging markets venture capital firm Timon Capital, which has invested in Omnibiz, said it believes the company is solving a much-needed problem. 

“The FMCG supply chain is fragmented, inefficient and opaque. Omnibiz tackles all of these problems and addresses them with an efficient software layer that provides much-needed data on this otherwise obscure market and supply chain. Deepankar Rustagi is an excellent operating CEO,” Katsaounis explained to TechCrunch.

However, Trendtype has warned that, while in the short term the number of B2B buying apps in Kenya is good news for consumers and retailers, it is unsustainable. 

“We believe that as the funding landscape tightens there will be at least one exit. Among the major platforms, Marketforce and Omnibiz are most vulnerable because of their relative lack of scale in Kenya,” the consultancy said.