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Start-ups as a hope for retail

David Eisenbeis founded the "alocalo" platform with students and a professor from the Saar University of Applied Sciences. The young company wants to offer a regional alternative to Amazon, Zalando & Co. In doing so, he wants to save many retail jobs while leaving the power to the retailer. He can then continue his normal business and does not have to submit to any strict guidelines from any online platforms.

"Amazon for local trade"

The core of the system is a plug-in, i.e. a program for the web browser. If you are looking for a specific product on Amazon, for example, the program automatically finds all local dealers nearby who have it in their range thanks to artificial intelligence. Ideally, the customer can then order it there with just a few clicks or pick it up immediately in the store. Not even the big shipping multinationals are that fast.

The idea is also easy for retailers to implement, says Frank Hälsig from the Saar University of Applied Sciences. The expert sees alocalo as "perspectively the Amazon for local trade". With EU funding of 2.3 million euros, the technology is now being refined even further.

Fewer and fewer owner-managed shops

As recently as 2015 there were almost 300,000 owner-managed retail stores. Experts estimate there will be 231,000 left by the end of this year. This means that more than one in five shops would have closed within a few years. The reasons are high rents, price pressure and problems finding a successor. In addition, a good two-thirds of stationary retailers do not even make ten percent of their sales online. alocalo wants to change that.

The platform has just started and has found the first 100 local trading partners. Now the company wants to grow rapidly throughout Germany. Because the larger the offer, the more attractive the platform is for consumers. For alocalo founder David Eisenbeis, it is therefore very important "that we are really much cheaper compared to Amazon. Amazon is extremely difficult when it comes to dealer support". The US group takes up to 15 or 20 percent per product as a sales fee from the dealer. Alocalo, on the other hand, requires 4.8 percent.

Online trade is growing at double-digit rates

Many of the large online marketplaces are currently running similar activities, says Bastian Popp from the Institute for Trade & International Marketing at Saarland University. That doesn't make it easy for start-ups like alocalo. But online business is booming. Sales have more than doubled since 2015. For this year, the German Retail Association expects further double-digit growth.

Even offline, the online giants are now cashing in properly: with vouchers that can mostly be bought in stores. The voucher market is estimated to be heavy at three billion euros. But here, too, there are attempts to break the supremacy of Amazon, Zalando & Co.

Heidi Houy started "keeplocal" with her own vouchers, which can be bought online, in stores or soon in petrol stations. This should enable customers to shop in as many local shops as possible – so far in Saarland, Rhineland-Palatinate and North Rhine-Westphalia. The coupons will soon be available throughout Germany. And next year also in Austria and Luxembourg.

A question of visibility

Keeplocal wants to grow fast this year. There are no fees for customers and dealers. Because the business model is based on the observation that a small percentage of vouchers are not redeemed. That is basically the fee that keeplocal lives on.

Whether regional vouchers or platforms that offer stationary retailers better visibility on the Internet – there are regional alternatives to the global corporations. Ultimately, the decision rests with the consumer.

The ARD business magazine plusminus reports on this topic today at 9.40 p.m. in the first.

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