Bagedo IB drives Saudi e-commerce
Hani Bagedo from e-mall Bagedo IB says that the company aims to make it easier for SMEs to market and sell their products online in Saudi Arabia
Bagedo IB is a Jeddah, Saudi Arabia-based e-mall and e-commerce facilitation company that specialises in creating web portals for entrepreneurs and small businesses currently based in, or looking to sell directly into Saudi Arabia. The company offers several packages to potential clients, for example, for SAR 2,000 Bagedo IB offers the company its own online boutique portal, the company can then choose the themes that it wants, upload products for sale, and Bagedo IB will market the company online.
"We decided to create our own portal which will minimise the headache of establishing your own website. It will be for boutiques, restaurants, hotels and services companies. It also supports SMEs and will help SMEs get into the market as well as helping them get into e-commerce in Saudi Arabia," said Hani Bagedo, Founder and CEO of Bagedo IB.
The reason Bagedo decided to set up the e-commerce portal is that Saudi Arabia has great spending power. The population of Saudi Arabia is over 28 million people with 3.9 million making online transactions. The majority of these people are aged between 25 and 45, 15.6 million are internet users. This means there is still massive potential for online shopping to grow. As predicted by PayFort's latest research, the expenditure of Saudis on internet shopping is $13 billion, that is just Saudi, not the GCC. Online shopping grew 34 per cent between 2013 and 2014. PayFort is speculating that online shopping will grow at an even higher rate in 2015 and 2016.
The current problem facing small companies in Saudi Arabia is that while people are interested in the online market, they don't have the facilities or know-how to access the e-commerce market.
"Not a lot of people here in Saudi Arabia would know what to do with e-commerce, or how to market their website, how you can create your own shopping cart, your own online shop, they don't have that facility available to the majority. We built something that is tailored to the Saudi market because it is made by Saudis for Saudis and for the GCC, so we understand what people here want and what people like and dislike," according to Bagedo.
Bagedo IB has tailored its offering to make it easy to set up a website. For example, right now to create a website independently, a company would have to deal with the domain name, then the server, then a specialised IT company. If the website includes transactions the company would need to go to their bank and establish a payment gateway. If it wants to do shipping it has to work out the logistics around that. In order for a company to set up all of those different aspects of an e-commerce site, and to maintain it, it is costly.
"Why don't you come with us and pay a minimum payment? You will have your own theme, your own style, your own identity. Plus you can keep your company name, it will be your shop name.bagedoib.com --if you have your own domain, your own URL, we can include that for you, so whenever people type in your name it will lead you the shopping cart. Plus we do marketing and SEO. So look at the savings you are making," said Bagedo. "For a small SME that is just starting their own business, or ladies from their own home creating their own products, selling abayas, candles, cupcakes, she doesn't have to deal with all of that headache in order for her to sell her product online. Look at online shopping for example: right now a lot of ladies work from home, they market themselves and try to get buyers through Instagram or Facebook. That is the cheaper version for them as they have a minimum budget so they can't spend a lot. We will open the gates for you and bring shoppers to you. You don't have to have the usual headache of maintaining your own website by hiring someone, an IT professional to maintain it for you," said Bagedo.
Bagedo IB launched at the beginning of April 2015 and already has three boutiques on its platform and ten more in the pipeline, all of them are small SMEs. Bagedo said that by the end of the month the platform will feature around 50 to 60 boutiques. Currently the shops on the platform include clothing, candles, accessories, and abaya businesses.
The site also has special sections for motels or chalets on the beach with a booking system available, and Bagedo IB has developed a booking system for restaurants and services companies such as plumbers, photographers, translators for example.
The major difficulty of setting up this business in Saudi was finding the right talent to do the programming. According to Bagedo this lack of local talent and understanding is why the IT infrastructure in Saudi is not yet very strong, and many companies have to rely on hiring outside web designers and programmers from places such as the US, UK, India and Bangladesh.
"Not many Saudis are capable of doing high functionality and high end websites here," said Bagedo.
The way forward
Bagedo IB hopes to conquer the Saudi market within the next 12 months, but also has plans to open in Oman as well as Kuwait -- which has a very good market in terms of online shoppers. The company also hopes to go global, with its sights set on the USA and the UK in the future.
"It is very difficult for foreign companies to market themselves in Saudi -- by coming into our e-mall they will be able to easily market themselves. This is why we are starting our business in Saudi, and slowly in the GCC before we go to London, so it will be easier for people in England to reserve a space, put their products up and reach Arabic clients. Whatever product you enter in English you don't have to go through the headache of translating or trying to find a good marketing slogan for your site. Arabic is the main language for the site with English, but we are introducing all the major languages like French and Russian," said Bagedo.
For the payment gateway on the site, Bagedo IB is working with a company called Gate2play, based out of Jordan. According to Bagedo, they are pioneers in the Arabian market and deal with all the major banks in the GCC. Bagedo IB has a special deal with Gate2Play for its clients in terms of charges and setting up the payment gateway details with the bank.
"Once you open an account with us, we will assist our clients to set up the payment gateway with specified banks who have a deal with Gate2play. The process to open the bank account will be really fast and whatever online purchases that happen through your boutique, the money will be deposited immediately into your account. So you are getting your money straight away. Literally we are like a service provider, we grabbed all the obstacles and put them in one place and found a solution for all of them and are offering it in a package," said Bagedo.
Bagedo IB also gives back to the community. The company has a couple of deals with a few charities, so whatever online purchases are made through the stores, a percentage will be going to either an orphanage, a charity for widows, or a charity for the handicapped.
"You don't have to feel guilty that you are shopping online, each time you buy a product you know a certain percentage of that is going to sponsor an orphan, or build a well, or support a widow. It is very important for all companies to give back. It is part of CSR; I think everyone should do that because we have to provide back for the community. If I care about my own country, then I would care about the people of that country, then we need to help each other, we need to help people who can't help themselves," said Bagedo.
