Saudi Entrepreneur on Ecommerce from the Middle East

In america, ecommerce is mature and sophisticated. That’s not the case in Saudi Arabia, where it is new and challenging. Hamza el Bayed is co-founder of a Jeddah, Saudi Arabia ecommerce firm named Ora La Moda, which sells fashion apparel.

I recently talked with him about the hurdles — and the opportunities — in launching an ecommerce business in the Middle East. What follows is the complete audio interview and the transcript of it, edited for clarity and length.

Practical Ecommerce: What’s the state of ecommerce in Saudi Arabia?

Hamza el Bayed: Ecommerce in Saudi Arabia is fairly new. The mentality of the Middle East with ecommerce, in general, is a bit different than Europe and the States. It is something quite new here, and folks are still struggling with the idea of purchasing online. But it’s getting there.

PEC: Tell us about Ora La Moda, the company you’ve launched?

Bayed: I began with the idea of starting an internet business with my spouse in late 2015. We studied the market on what was the best service or product we could provide to the Middle East. We came up with fashion and accessories. Additionally, it does not require a lot of licenses, and it does not need a massive warehouse.

We found a few similar businesses already out there. They are quite large, so our market share could be rather small. The opponents were much more powerful than us. As opposed to becoming a freelancer for major brands, we made a decision to become our own brand, focusing on quality. We didn’t just attempt to make a fast buck.

It took us about six months to prepare the whole concept in design, to colours, logo, and a company name. It was not very easy, but I think we did a fantastic job.

Our target segment is over 25 years of age. These are the men and women who have jobs, who have credit cards, who can afford to pay for quality. The younger generation, particularly here in Saudi Arabia, prefer to go out instead of store online. Shopping is essentially their outlet.

PEC: so that you market mostly female fashion accessories?

Bayed: Right Now, yes. We did not have much capital to begin with, so we split our launching into four unique categories. If we could win the confidence of the female section from the Middle East, then we can develop into various sectors. Following the female section, we could expand into babies, children, men, and begin building up our catalogue.

PEC: You speak very good English. How did that come to be?

Bayed: I lived in England for approximately a decade. I went at a really young age, I think when I was 11, and that I came back I think in 2006.

PEC: What are some barriers to conducting an ecommerce company in the Middle East?

Bayed: By the time that I spent in England, I heard so much on how I can install this kind of business. In Saudi Arabia, or in the Middle East in general, people expect a business that has lots of funds.

In Europe or in the States, someone can begin from his garage and develop a company until it becomes, essentially, a giant. That was a huge challenge for us, on the limited funding we had, to provide our word stating that we are trustworthy. This is one of those struggles that we’re facing now, because we’re a really small establishment.

So we began tackling these things, saying, okay, I’ve Norton Symantec on my website saying I’m verified. Aramex, our shipping service, is one of the primary shipping agencies in the Middle East, and they are very trustworthy.

PEC: Many merchants in America use hosted platforms. However, you utilize CS-Cart, licensed applications.

Bayed: We’ve got our own server which we’re renting. We looked into many distinct platforms to use. We wanted something that we are able to edit, we can change, we could add on to, and that may be more flexible for our needs and, of course, multilingual. We had many diverse platforms, but with CS-Cart we discovered the flexibility that we require.

PEC: Where do you go for development aid?

Bayed: We’ve got two unique businesses that we work with. For issues specific to CS-Cart, we utilize Simtech Development, in Russia.

PEC: How did you learn your business skills?

Bayed: I majored in business management, and I lasted into master’s and research. My dad is a businessman and his father was a businessman. It runs in the blood, essentially.

PEC: how can you handle transport, payments, and stock in Saudi Arabia?

Bayed: We’ve got two different payment methods: cash on delivery and credit cards. With credit card payments, we went with two unique businesses, PayPal and 2Checkout. Both are located in the States.

Our primary payment method is cash on delivery. With Aramex, when they send the merchandise or the box to the client, they collect the payment. They take a small charge, and then, at the end of the month, they wire transfer the remaining amount to us. The majority of my earnings, I think it’s about 80 percent, is cash on delivery.

PEC: Where are your clients located?

Bayed: Right Now, we are just in the Middle East. We began to grow quite recently to Europe and the States, since we’re in a tiny recession in Saudi Arabia.

There are a couple of countries that we can’t ship to, as a result of law in Saudi Arabia. Some other nations, it is a hassle or they are very expensive to send to.

PEC: Anything else?

Bayed: to anybody who want to start a company, ecommerce is one of the simplest ways and it does not need plenty of money to establish. If you know how to put this up, it is fairly straightforward. You can begin from as little as $50 and grow out of that. Just know your market and what the people that you need to market to need. You may create a successful company from it.

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