This is discussion about Tiendatek - Mobile Business Tools for Micro-Entrepreneurs - Colombia.
Welcome to changemakers. Thank you for sharing your amazing experience with us.
Can you please provide the answers to the questions of Challenges. Will be great for our team to understand and support to the barriers you face.
Thanks Julia. That section didn't originally appear on the Web site when I went to publish our entry but I've just updated it now. Cheers!
This is a great idea and it appears you have gotten the project along well. I have some comments that you may want to consider to update your entry:
- How does your organization work around the cost barrier of the smartphone and internet service itself?
- Consider adding some more details on the impact your project (technology) has already achieved.
Thanks for your entry and best of luck with your services!
Thanks Ravi! I've updated our application a bit to reflect your feedback. Very much appreciated!
Hey Mark, This looks like an excellent model. But the field is littered with things that looked good until they were actually tested in the field.
So, based on your experience thus far, how long does it take to get the store owners to adopt the technology? How do you handle training and on-going support for the usage of the system?
Also, are their any issues with the customers of the mom and pop stores? Does ultimate adoption by the storeowners rely on their customers agreeing to share data or does it all happen automatically?
I suspect you have answers to these questions -- it may help to include some of them on the application.
Thanks and good luck in the competition,
Hi Randall. Many thanks for the comments. All great questions. I'll update our application to include my answers but let me respond briefly here as well.
In terms of testing in the field, we have been in Colombia and Mexico for two years now so we have quite a bit of on-the-ground experience and the scars to prove it. We've been experimenting with different sales and distribution models but we have over 80 shopkeeper users as this point so we've learned quite a bit. Fortunately, most of these users are very happy with Tiendatek and tell us that through better inventory management using our program their profits have gone up which, of course, is music to our ears.
In terms of how long it takes for a new user to learn the system, the answer depends on the profile of the shopkeeper -- their age, the type of store, their comfort level with technology, etc. -- but the range is normally 1-3 weeks. The first step is coding inventory, but even though we have a database with most of the products sold by mom-and-pop shops, each shopkeeper has different levels of inventory and prices so this information needs to be specified for every phone. This process only takes a few days for the best users but in other cases it can take a few weeks, and after their inventory is inputted they start using Tiednatek for sales and purchases. In some cases we go to their stores to help code inventory so we can speed up this process.
With respect to the question about training and support, we generally deliver the phones in person and give in situ training; it normally takes about 1 hour on average but, again, it varies. Increasingly, however, we are trying to train shopkeepers in groups with the help of partners (e.g., organizing workshops) We also do as much support as possible via phone, email and the application itself but in the first few weeks we normally do in-person visits as well. Lastly on this point, we've divided Tiendatek into different modules so shopkeepers can learn and go through the application at their own pace. So we're doing lots of things but as you've correctly pointed out this is definitely a key component of our business model we need to constantly improve.
In terms of privacy, we aren't collecting much data (yet) on the people who make purchases in stores, just the shopkeepers, and since Tiendatek is very similar to a normal point-of-sale system (except better!) the end customers often don't have reason to comment. Of course, with our retailer clients privacy can be a huge issue, and to make them feel more comfortable we are happy to sign a contract with them which states that while we will use their data for products such as market research reports and mobile advertising, we’ll use it in an anonymous way and not reveal any personal details without their consent.
If you have other comments or questions please let me know. And thanks again!
Good evening, Mark.
It looks like you have a great start with Tiendatek. The small businessperson is often targeted for these kinds of interventions, so I hope you’re learning well from other initiatives that have gone before. I hope the following comments help make your application even stronger.
Thank you Kohl for your sharp and detailed questions. I'm Mark's technical cofounder, so I'll take a stab at them.
- I believe we're a bit different from MySMENews and World of Good. We essentially provide the shopkeeper with more information about his own business, not necessarily about other companies (although that may be a good complement, thanks for the pointer!). We have studied some examples of interventions focused on this actor but we can always learn more! Could you provide us with some pointers? thanks!
- Yes, for the time being we need to offer Android handsets and barcode readers along with our software. We wish we could use existing feature phones but unfortunately they're not powerful enough to meet the needs of the shopkeepers (highly usable, quick so there's no customer wait, reliable, connected to peripherals and to the internet).
- I would say around 25% of our users squeeze all the juice out of the software. About half use it for most operations but not all (for instance, they may not track expenses). Finally, around 25% only use it to track sales and informal credit. We have shopkeepers that have used the application for over a year, despite its early and buggy stage back then, and almost all shopkeepers that start tracking sales never stop doing so.
- Large companies producing the goods sold in the stores are both a client for our data and communication services and also an ally to reach more and more shopkeepers. Hence we need to negotiate with them how a mass roll-out would take place. Also, as you point out we need to deal with the HW manufacturers to get good prices for the devices
- The data collection is performed primarily for the shopkeeper's benefit: only that way she can realize how her business is doing and how to improve on it. It's also the only way to have business continuity in the face of an accident or loss of the hardware. We then commercialize the anonymized data to create a cross-subsidy from the large companies. The shopkeepers are protected in their privacy through a contract we sign with them.
- There is definitely the potential for the information to be misused. To minimize the risks, we anonymize everything and mask the physical location of each user. This also becomes useful to alleviate a shopkeeper concern: that their data could fall into the hands of the tax authority (they're mostly informal and don't quite pay taxes. We hope that by making the tax filing easier, eventually we will help formalize them).
- The model has certainly been polished and we're getting ready to start scaling up. However, funding in this space is hard to come by given the inherent risks and we still need validation and financial help. Ashoka and this Changemaker competition could provide both at once!
Great questions as well. David answered most of them but let me add a few additional comments.
Innovation New Contribution
• If I had to compare Tiendatek to another product already in the market, my choice would be the point-of-sale systems used by large supermarket chains. Here the data and subsequent analysis are less about the market and more centered on personalized, actionable information specifically for individual stores (e.g., best products, optimal ordering quantities, break-even sales, etc.). Of course, the POS systems used by supermarkets are unavailable to mom-and-pop retailers even though many sell 1,000+ products and clearly have a need.
• It is true that smartphones are still relatively expensive, although prices are dropping rapidly. However, the usability of a touch screen is very important when you are working with individuals who have less experience with technology -- for example, we can use big icons with little text, multi-media, etc -- yet need all the sophistication of a system that can track sales and purchases of 1,000 different products, credit sales, reports, etc. In short, we can combine power with ease-of-use more easily. Moreover, as a start-up we need to focus our resources effectively and, in my view, creating different versions of Tiendatek for different platforms would spread ourselves a bit thin.
• Regarding our consumer packaged goods partners, as David mentioned they are a key distribution partner since only a sub-set of micro-retailers will be interested in our technology and we need to work with partners that already know this channel and can help us reach them efficiently (e.g., provide segmented lists of potential candidates, introductions, etc.). Moreover, most want to strengthen the shopkeeper channel as it could give them a strategic advantage given its size and importance and also because more Wal-Marts are not always good for their bottom line.
• In Colombia, when we have sold phones with a subsidy, we tell the shopkeepers that the subsidy is dependent on using Tiendatek for registering sales and this is normally fine as this is what they are interested in anyway. We have lost a few potential users due to privacy concerns but not many (although many have wanted to sign a the contract I mentioned in an earlier posting).
Thanks again for the questions.
Queridos Mark and David,
Supongamos que un inversionista estuviera interesado en financiar el crecimiento de Tiendatek. Cuales serían los mecanismos para hacerlo?
Si Frogtek es una entidad sin ánimo de lucro podrían ser préstamos, pero si tienen entidades jurídicas con ánimo de lucro podrían considerar otros instrumentos. Otra posibilidad podría ser mantener el crecimiento con ventas y donaciones.
Felicidades por representar a América Latina en el desafío y buena suerte!
Muchas gracias por contactarnos. Somos una empresa social pero con fines de lucro -- Frogtek es oficialmente un LLC basada en los EEUU -- asi que tenemos inversores. Tenemos sucursales en Colombia, Mexico y Espana tambien pero la entidad en los EEUU es "la madre" de todas.
Si quieres hablar mas de los especificos creo que tiene mas sentido que nos hablemos en otro foro. Me puedes contactar a firstname.lastname@example.org.
Gracias por tu rápida respuesta Mark,
Me pareció interesante que la comunidad de Changemakers supiera cómo se han estructurado para crecer.