Riding the e-commerce waveWith better Internet access, mobile penetration and the country’s growing tech-friendly middle class, Nepali e-commerce websites have started gaining traction
Although Maharjan had the option of approaching local second-hand dealers, he said he was not getting the right value and wanted to give the Internet a try.
“At first, I was skeptical about the whole Internet approach, as I was not sure whether I would get a good response at all. Then, there were issues of trust and liability. But after having sold the car successfully on Hamrobazaar, I am now of the opinion that it was more convenient than I thought,” he adds.
Hamrobazaar currently stands out among a growing number of Nepali ecommerce websites as a convenient platform for prospective buyers and sellers to market and bid their products. The site receives more than 315, 000 unique hits a month and has categories ranging from automobiles, consumer electronics and appliances to real estate and travel services. What makes it even more appealing to the customers is that it is very simple to use and its services are free.
Convenience is a big driver for such sites too, notes Prabal Saakha, the managing director of Hamrobazaar and the Saakha Group.
“Commerce is more convenient online and e-commerce websites like ours are capitalising on this shift in behaviour. It used to take months and years for people to sell their products before. But now they can do that with a click of a button,” he says.
Amun Thapa, CEO and founder of sastodeal.com sees the same advantages. Sasto Deal is an ecommerce marketing website that provides a platform for merchants to sell their products online and provides customers with various discount offers.
It helps that a growing number of Nepalis are getting more and more comfortable with ecommerce. “When we first started out three years ago, merchants and sellers were hesitant to market their products on our website. The majority of our buyers were mostly youths based in Kathmandu. But, now all that has changed. We have diversified our customer base and people are slowly understanding the advantages of doing business online,” he adds.
The best part about websites like Hamrobazaar and Sasto Deal is that they not only provide convenience for shoppers, but for vendors too. They provide platforms that other businesses can use for marketing their products—without the companies’ having to invest in additional brick-and-mortar stores. Sites like Hamrobazaar also work as a platform for individuals who may want to sell off things they don’t need, sellers who are not necessarily traders.
But the sites themselves have had to get creative about finding revenue streams for themselves. Since Hamrobazaar does not charge its customers, they rely on advertisements to generate most of the revenue for the site. Sasto Deal depends explicitly on commission charges and discount offers for profits.
Another popular website harilo.com has also been active in the domestic ecommerce industry for the last four years. Harilo allows users to purchase products from a range of US-based websites like Amazon and ebay, and gets them delivered to customers’ doorsteps.
“It’s very useful for people who do not have international credit cards. Our services allow people in Nepal to buy goods from American retailers and pay with Nepali rupees. We then ship the goods to Kathmandu and pay customs and VAT on their behalf,” says the manager of Harilo, Steven Bajracharya.
But while, many of these e-commerce sites are currently riding the wave of enthusiasm for the convenience provided by online shopping, over time, quality and the ability to adapt to a changing market will also matter.
Sasto Deal’s Thapa is quick to point out that more players in the ecommerce industry will be necessary to ensure that there is competition and improvement in business models and service delivery.
Continued growth of the sector will also depend on a variety of factors, including government tax policies and cross-border customs regulations, availability of adequate and secure payment solutions, shipping and handling standards and Internet access costs.
Bajracharya says that currently, unnecessary government regulations on imports have not been helpful to his business.
“For instance, the Nepali government doesn’t allow us to sell anything that’s digital. And there are restrictions on mobile phones and wireless routers or small things like camouflage prints or multi-vitamin tablets. This not only restricts our customer base but the government also misses out on the tax payments they could have received,” he says.
Prabal Saakha of Hamrobazaar says that for the ecommerce industry to grow, there needs to be an overall improvement in the Internet infrastructure and government regulations, which would create cheaper and more reliable online services and better payment gateways.
But despite operating in a country where most people don’t own credit cards, these companies have found a way to not only find a niche but also entice more people to opt for shopping online.
What started out as a novel idea more than a decade ago with Nepal’s first ecommerce platform, thamel.com—which introduced the novel concept of selling goats online—has now turned into a burgeoning online retailing market. With the recent entry of global players like kaymu.com, the e-commerce sector in Nepal has started to heat up, and the race to rope in more online buyers and sellers has just begun.