How To Sell Online In Kenya – Ultimate GuideWhy should you sell online?Ecommerce in Kenya is booming. Broadband internet and explosive growth of mobile phones are fueling the growth of online business further. Covid-19 pandemic accelerated it the most. Online Marketplaces such as OnlyZap, Jumia and Jiji are offering a platform for users to sell their products and services online. If you have a product or service to sell, this is perhaps the best time to start selling it online. Here is an ultimate guide to teach you how to sell online in Kenya.
But before you start to sell online, you should do the following.
1) Calculate the costs involved in selling onlineSelling online in Kenya or in any country for that matter, involves various costs. It’s important to first find out if you can make good profits after considering all those costs. Let’s look at some of the important costs:
- Shipping Cost – Identify the best courier or shipping company like SafeBoda and find out how much it would cost to ship your product in various parts of Kenya. Make a list of estates and shipping fee. Normally this cost hovers between 5% to 15% of the product cost depending on the size and weight of the product.
- Packaging Cost – Depending on the type of product you are planning to sell, you will need to consider the packaging cost. Check the different packing material and calculate how much you will need for one product. Calculate the total cost per product accordingly. Normally it’s between 0.5% – 2% of the product cost.
- Payment Gateway Cost – If you planning to setup your own online web-shop, you will need a payment gateway e.g Mpesa Online Payment. The good thing about this is that it is free in most cases.
- Storage Cost – Depending on the product, you might need to rent warehouse or some storage space for your products but at the beginning, this could be your home. Find out this cost as well.
- Marketing Cost – Like any other business, you will have to tell the world that you have arrived. Surely, there are free ways to promote your business but at some point of time you will have invest in paid marketing channels.
2) Find out if its viable to sell onlineNow that you have a fair idea of different costs involved in selling online, you can do quick math to find out the profitability of your venture. Here is a simple formula: Profit Margin= Selling price – (Sourcing Cost + Packing & Shipping + Transaction Fees + Marketing Cost + Variable Costs) If your profit margin is positive, you are good to go ahead and start selling online. If it’s very low or negative, you should think about minimizing the costs.
3) Create digital profile of your productsAssuming you have passed the profit margin test, it’s time to take the next step. You will need to create a descriptive profile of your product, ranging from good quality images, videos, infographics, text etc. This list should contain Product Name, Descriptive images, Category, Selling Price, Discount (If any), Brand, Colour and other applicable attributes. You will be able to use these details while uploading your product to the ecommerce marketplaces or self hosted website
4) Setup End to End ProcessIt’s better to get organized from the day one. Do you know how event management companies manage huge events without any goof up? Well, they play the entire event in their minds before they start working on it. You can do the same and lay out a process describing steps from getting an order to shipping the goods or delivering the service. It could be a simple checklist for doing quality checks, packaging, invoicing, etc. This will help also help your colleagues when you are not around.
5) Use A Good Inventory Management SoftwareAs you will be dealing with inventory every day, it might become painful to manage inward and outward stock movement manually. Start using a good inventory management software to track your inventory. Some of the software even provide inventory sync option with your shopping cart or marketplace account.
6) Be visible onlineYour customers are more likely to search for your business before they make any purchase. If they can’t find product reviews or any other information about your business, they might drop off. So, it’s important to have online presence in the form of company website, social media account or any other channel.
Selling On Marketplaces Vs Own ecommerce website.Now that you are ready to sell online, its time for the big decision. Should you sell on online service marketplaces like Jiji or Jumia or should you setup your own ecommerce website?
Let’s evaluate the first option:
Sell online using ecommerce Marketplaces:This one is perhaps the simplest option. Process of selling on these marketplaces is very simple and you can start selling within a few days.
- The Process Involved – All you have to do is to visit seller-registration pages of these marketplaces, signup and submit your business details. ou will need to keep KRA Pin number, ID number and Bank details handy. Some sites need address proof as well. You can upload scanned copies of these documents. Verification is completed normally in couple of days.
- Advantages – You can save big on the marketing cost. All of these marketplaces attract thousands of visitors everyday and have a loyal user base. You also don’t need to worry about the payment gateway and shipping. Most of these portals provide packing material as well.
- Disadvantages – These marketplaces charge higher commission on every sale. For some items, it could go upto 15-20%. Apart from this, you have a little control over how your product is displayed on their sites. As you can see, selling on ecommerce marketplaces is fairly simple and straight forward process. It takes less time and you can save on your marketing costs.
Now, let’s look at the other option:
Setup your own web store or shopping cart to sell online:This option can be further split into two parts – You can develop your own ecommerce website and start selling your products and services. You may make this site a market place for other interested online sellers to list their products and services for sale.
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- Process Involved – Develop your own ecommerce website and upload your product and services, market your brand and start selling. You can link your own payment gateway.
- Advantages – The website becomes your own asset and you can use it to promote other services. With a good web developer, it is easy to customize the look and feel of your store.
- Disadvantages – You will have to invest in website development and marketing your site. It will take time build a brand for your customers. So, take your pick and start selling online.
How to Make Your First Sale!Once your website is up and running, it’s time to generate your first sale. Here are 5 ideas to making your first sale:
Start Emailing Your Contacts
Sell To Friends & Family On Facebook
Buy Social Media Ads
Promote On Google
Generate Discounts to First time buyers