Zimbabwe has millions of its citizens living abroad. A significant percentage of these people not only have relatives back home but some of these are also their dependants. Because of this, there exists a huge market for cross-border money transfer services. Remittances happen to be one of the country’s biggest sources of foreign currency. While the best-funded companies tend to command the lion’s share of the remittance services market other companies have still managed to find success by carving out niches for themselves in the industry. One of the services which have managed to serve as an alternative to person-to-person remittance transfers is the grocery services which allow people based in the diaspora to grocery shop for their families back home instead of sending them money. The emergence of players like Malaicha shows that this business model may be a serious contender for money transfer services. Here we discuss how one can start such a business.
Receive orders
To begin with, you will need to find a way to allow your customers outside the country to submit orders. One way of doing this is to establish offices in countries which are residences of the expatriates whom you want to serve. Obvious examples are South Africa, the United Kingdom and the US. Unfortunately for each one of these, your intended customers will be scattered across several cities which are hundreds of kilometres apart. It is then obvious that if you expect people to visit your offices to make their orders then your market reach will be limited to those who live in the vicinity.
Adding more offices is not a scalable solution to reaching more people in any one country as each of these require more resources—sometimes more than the amount of business which the new location would bring in. Fortunately reaching everyone is not a requirement, you can enjoy success with just one well-located office e.g. in a population centre with large migrant populations.
Another way of reaching more people in your target country is to establish partnerships with local businesses (in that country) particularly those which have numerous locations e.g. ones which operate as chains. You would most probably need to fork out a percentage of the orders which come in through them. Unfortunately only larger companies or those with very significant amounts of investment have the clout to strike up such kinds of partnerships. An alternative to such partnerships is the employment of individuals to serve as your agents in their communities.
Fortunately, this is the 21st century; you can also receive orders through a website or via phone, email or communication platforms like Whatsapp. Just remember that for an online business what you do not pay as rent for a physical location, you will need to make up for in advertising expenses.
Accept payment
Orders have to be paid for. If you have physical offices or have entered into one of the aforementioned partnerships you can accept cash or card payments. However, if you only interact remotely with your customers e.g. via website or Whatsapp, you can accept wire transfers or online payments via cards (see Paynow Visa and Mastercard payments) or services like Paypal. Remember that many members of the diaspora are either undocumented or are informally employed in their countries of residence —these are people who can only pay in cash, so do not get carried away in your adoption of remote payments.
Delivery to final recipients
The final stage of the transaction is you delivering the paid-for groceries to their intended recipients in Zimbabwe. You can deliver the groceries door-to-door via your vehicle or contracting a third party one. However, it is more common to just notify the recipients when their groceries are ready so that they can come to collect them personally. Locally you can operate one or more such collection centres. Also, remember that locals who are working outside the country come from all its parts.
To expand your local distribution network you can partner up with local businesses e.g. shops which are close to the recipients. Such shops can operate as mere pick-up points or you can pay them for the specific goods which have been ordered and which the recipients are supposed to collect. In this latter scenario, you are more of a glorified money transfer agent.
Market the business
Once every facet of your business which allows you to deliver on your offer is in place you can then get around to marketing yourself. So how do you promote a business whose target market is outside the country? You can simply start by marketing to these people’s dependants who are inside the country—this means good old local mass marketing. You can also use online advertising through Facebook and Google whose advertising tools can be used to specifically target citizens living outside the country. Good old word-of-mouth will also serve you well if you offer a great service to your customers.
