Online shopping: start-ups hope for retailers

Status on: 03/08/2022 18:11

Classic commerce has suffered from online competition from large corporations for years. Young companies are trying to introduce to the Internet what small, local shops have to offer.

David Eisenbeis founded the alocalo platform with students and a professor from Saar University of Applied Sciences. The young company wants to offer a regional alternative to Amazon, Zalando & Co. In this way, he wants to save many jobs in retail, leaving the power to the seller. It can then continue its normal activities and does not have to follow any strict guidelines from any online platform.

“Amazon for local commerce”

The core of the system is a plug, i.e. a program for a web browser. If you are looking for a specific product, for example on Amazon, the program will automatically find all local dealers nearby who have it in their assortment thanks to artificial intelligence. Ideally, the customer can order it there with a few clicks or pick it up right at the store. Even the big international shipping companies aren’t that fast.

The idea is also easy for retailers to implement, says Frank Hälsig of Saar University of Applied Sciences. The expert sees alocalo as “prospectively Amazon for local commerce”. The technology is now being further improved thanks to EUR 2.3 million in EU funding.

Fewer owner-managed stores

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

The platform has just taken off and found the first 100 local trading partners. Now the company wants to grow rapidly all over Germany. Because the larger the offer, the more attractive the platform is for consumers. For alocalo founder David Eisenbeis therefore it is very important that “we are really much cheaper compared to Amazon. Amazon is extremely difficult to support the dealers. ” The US group charges the dealer up to 15 or 20 percent per product as sales fee. In turn, Alocalo requires 4.8 percent.

Online commerce is growing at a double-digit pace

Many of the big online markets are doing the same thing right now, says Bastian Popp of the Institute of International Trade and Marketing at Saarland University. This doesn’t make it any easier for start-ups like alocalo. But online business is booming. Sales have more than doubled since 2015. This year, the German Retail Trade Association expects further double-digit growth.

Even offline, online giants are making good money now: thanks to coupons that can be purchased mainly in stores. The bill market is estimated to be heavy at three billion euros. But here too, attempts are made to break the supremacy of Amazon, Zalando & Co.

Heidi Houy started “keeplocal” with her own vouchers that can be bought online, in stores or shortly at gas stations. This should enable customers to shop in as many local stores as possible – Saarland, Rhineland-Palatinate and North Rhine-Westphalia so far. Coupons will soon be available throughout Germany. And next year also in Austria and Luxembourg.

The matter of visibility

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

Whether they’re regional vouchers or platforms that offer land-based retailers better online visibility, there are regional alternatives to global corporations. Ultimately, it is up to the consumer to decide.

The ARD plusminus business magazine reports on this today at 21.40 on the first.

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