Sri Lankan e-commerce revolution: Where small sellers win over big companies

The Government of Sri Lanka’s National Digital Economy strategy partly focuses on encouraging entrepreneurship and start-ups that will support the country’s digital economic drive. The goal is to increase the number of small businesses that will also extend into creating more career opportunities. 

Companies such as Daraz have made it easier for aspiring entrepreneurs by creating online market spaces that serve as additional sales outlets and reach out to a wider customer base. 

“We offer logistics, payment and marketing services to small shops who want to start selling online,” says Daraz Sri Lanka Country Head Bart van Dijk. “Be it a smartphone in Sri Lanka, a laptop in Sri Lanka, or anything as small as a hairpin, everything and everyone can sell on Daraz, the online shopping leader in Sri Lanka.”

For Seller Community Manager Rukshan Praveen and his team, the task is to increase the online community of sellers. “Most sellers are surprised as to how easy it is to start on Daraz,” he comments. 

All an interested seller needs to do is to visit the ‘Sell in Daraz’ page and fill in the basic information. An individual seller only needs an NIC and a bank account passbook. An organisation should submit copies of the Business Registration and Bank Statement.  The form directs to the Daraz Seller Centre, which is the seller dashboard where one can upload products – “as easy as uploading a photo with a caption on Facebook”, says Praveen – track orders, build their store, see seller tools, participate in promotions, and basically develop their own outlet.

Every week Praveen and his team provide training for sellers in Sinhala, Tamil and English in Colombo. Besides the weekly trainings, he also goes proactively to universities and organises Seller Summits to spread the word. 

In 2019, the team has spoken to hundreds of sellers in Kurunegala, Jaffna, Galle and Kandy. “We also try to engage with universities in order to educate students on the ecommerce revolution. The younger generation is comfortable with using the technology, they are innovative and they like to do experiment,” he adds.

Van Dijk observes the trends and successes on the online platform: “Our goal is to give the small sellers a fair shot online. Our platform equalises the playing field. We see students and stay-at-home moms winning from the big guys. That is very exciting to see. We see that big companies are slow to respond to the digital revolution, which gives aspiring entrepreneurs a real shot at success. Our most successful sellers started from their home and took a keen interest to learn how to use our tools.” 

More than 150 of these small sellers currently generate a revenue of more than Rs. 200,000 per month, while some are selling goods worth millions of rupees. These sellers sell a variety of products, from motorbikes to flashy modern furniture to fashionable sarees.

Sajid is the owner of Simple Accessories, one of the successful stores on Daraz selling small electronic accessories and affordable phones. “Customers come with a lot of different questions, I try to help them as much as possible by answering their questions online,” he says. Daraz allows him to directly connect with customers, in case they have questions about his products.

Although starting to sell online is easy, being successful at it is not. You need to update your stock levels and package goods on a daily basis. Daraz has strict requirements regarding the quality of products, fast processing and out of stock issues. If sellers do not meet their guidelines, sellers are put on ‘holiday mode’, where they are kept offline for 14 days. During this time they have to streamline their processes and read the guidelines. If sellers pass a final test, the seller will be allowed to come back online. 

Internal research has shown that a good seller education is key to keep sellers engaged, which in return leads to a better customer experience. Many customers on Daraz are first-time online customers. If their experience is below the expectation, the chance of them coming back a second time is small. This is where the Daraz Seller University plays an important role. The portal makes all training material available to sellers including starting a shop, participating in campaigns and analysing data.

The online market space thus enables sellers at different levels to build businesses within their capacities and challenge the traditional market model on a level field.