The number of global retailers, department stores and supermarkets operating in Pakistan is increasing, which means convenience for consumers but problems for kiryanas or small general stores. According to a report from the State Bank of PakistanGeneral store growth will slow down, especially in urban centers, as large stores continue to expand their networks.
One of the reasons kiryanas struggle to compete is that many still run on pen-and-paper systems. Karachi based SnappRetail wants to help them digitize all their operations while providing microloans at the same time. The Karachi-based company announced today that it has raised a $2.5 million pre-seed funding round led by Zayn Capital’s BitRate Fund with participation from Antler and Century Oak Capital.
The funding will be used for product development, recruitment and expansion of SnappRetail to 1,000 customers, aiming to cover 13 cities by the end of 2024. The startup’s CEO, Adeel Rasheed, told londonbusinessblog.com that there are 900,000 supermarket chains in Pakistan and that it targets 300,000 retailers contributing 50% to the transaction volume of groceries.
SnappRetail’s products include point-of-sale (POS) devices and an end-to-end operations platform (for inventory management, inventory ordering and analytics) that helps small retailers compete with larger ones. The platform also allows them to accept digital and card payments and access microcredit for working capital.
SnappRetail was founded in 2021 by Rasheed, Moazzam Ali Khan, Ahsan Aziz and Moiz Ali. The team’s first launch was a retail recruitment consultancy called Resource Linked, which helped 100,000 retailers hire employees. Rasheed and Khan’s past experiences include time spent at consumer giants such as Unilever and L’oreal.
Rasheed told londonbusinessblog.com that the team’s background in retail led them to launch SnappRetail, seeing that many kiryanas run on manual systems and do not have bank accounts.
“Essentially what this is doing is that these store owners are missing out on a great opportunity to leverage technology to extract insights from sales data and make forecasts, improve financial management, better manage inventory and the list goes on,” he said. he. .
SnappRetail makes money by charging a monthly retail rate from its customers. It also sells retail sales data to major consumer goods manufacturers. Rasheed said as the company signs up more retailers, it will launch more monetization channels through partnerships for products such as working capital loans, B2B aggregation and card payments.
Another startup digitizing retail in Pakistan is Bazaar, which announced a $70 million raise earlier this year. When asked how SnappRetail differs from Bazaar, Rasheed said: “Bazaar is an app-based B2B platform. On the other hand, we implement a hardware-hosted micro-enterprise system in the store that helps the retailer digitize their core in-store business. SnappRetail is more like Square in the US, but for the supermarket segment and more like Jiomart in India.”
In a statement, Zayn BitRate Fund co-founder and general partner Faisal Aftab said: “Because SnappRetail is a globally proven concept, there is no doubt that it has the right approach to solve the retailer’s essential problem. We were especially among the impression of experience and maturity that this founding team brings to the table and manages to strike the right balance between hypergrowth and managing the burn.”