To assist merchants to compete with contemporary hypermarkets like Alfatah and Imtiaz, retail digitizer SnappRetail has raised $2.5 million in pre-seed funding for their microenterprise system.
Antler and Century Oak Capital joined the BitRate Fund of Zayn Capital, which led the round.
To help businesses stay current and competitive, SnappRetail offers a variety of digital solutions to Pakistan’s traditional and small-scale merchants. Adeel Rasheed and Moazzam Ali Khan, both former employees of Unilever, along with Ahsan Aziz, a former TRG employee, and Moiz Ali, a former employee of Primatics Financials, co-founded SnappRetail in 2021. The firm provides point of sale (POS) technologies for retailers and a digital operating platform.
The team at Snapp not only has direct experience working in the retail sector for one of the largest FMCG businesses, but they also cofounded Resources Linked, a company that offered recruitment services and asserts to have placed workers at 100 stores.
To help shop owners manage end-to-end operations, the Snapp team has developed a microenterprise system. This solution enables traditional merchants to increase their margin and revenue, eliminate operational inefficiencies, and enhance cash flow.
Although all of Pakistan’s kiryana stores may be able to use the technology, it is believed that due to scale and challenges related to digital literacy, not all of them will be able to do so. The top 200,000 to 300,000 mom-and-pop shops that are large enough to require such systems are the ones SnappRetail is aiming for.
According to Adeel Rasheed, CEO of SnappRetail, “Our target retailer is the one which has daily sales ranging from Rs 1 million to Rs 3 million and keeps 10,000 to 20,000 products at the shop location.” Such merchants confront competition from contemporary supermarkets, so the first step they must take to compete is to transition from manual to digital operations.
The use of digital technologies by retailers enables them to make rapid and wise business decisions, such as timely and adequate inventory restocking, which subsequently improves revenue and margins and ultimately aids in business expansion. To give shops other revenue sources like cellphone top-ups, the startup is further integrating with finance firms.
In the long run, SnappRetail will give these retailers access to micro-credit through affiliated banks and fintech firms for working capital, provide them with systems to accept digital payments, and assist them in streamlining the acquisition of inventory by collaborating with distributors and B2B eCommerce startups.
Currently, SnappRetail offers its system without requiring any upfront payments and charges a monthly leasing cost of Rs. 1,500. They want to raise this amount once the shops perceive an increase in sales as a result of using SnappRetail.
“However, the three primary revenue sectors would be. According to Adeel, three examples would be when we make loans to retailers through our partners, when we accept digital payments, and when we place orders with wholesalers.
The business presently has its system installed at roughly 100 merchants, and in the next months, it intends to expand that number to 1,000 across Pakistan.
“We think the entire retail and startup ecosystem is working to make it easier for traditional retailers, grocery stores, and other businesses to make a living. We are working to develop an ecosystem that will allow all aggregators and other applications to utilize our core platform. According to our pilot, retention is quite high and the system’s gross transaction value is significantly higher than any other play, said Moazzam Ali Khan, co-founder of SnappRetail.
The general partner and co-founder of Zayn BitRate Fund, Faisal Aftab, remarked on the investment, saying: “Being a proven concept globally, there is no doubt SnappRetail has the proper approach to tackling the fundamental problem of the retailer.”
“The knowledge and maturity this founding team brings to the table, striking the correct mix between hypergrowth and burn management, truly impressed us. As SnappRetail prepares for national and eventually international success, this balance is imperative.