Online merchant financing heats up as Rider and CreditBook also join hands to expand SME lending

Two VC-funded startups catering to SMEs in the e-commerce space have partnered up to leverage their respective business models to boost sustainable growth. Rider is a logistics startup providing tech-driven delivery services to online merchants on the back of US$ 5.4 million in estimated funding to-date. While CreditBook is a digital platform catering to small businesses for managing their credit, sales and expense cycles with the aim of helping them gain access to financial services. The company has raised approximately US$12.5 million so far.

According to information shared by Rider, the 'strategic partnership will enable Rider to expand its "cash on pickup" model, providing working capital solutions to its 1000+ active merchants to help them grow'. In his latest interview, the company's CEO Salman Allana shared his perspective and interesting insights on the current state of Pakistan's startup ecosystem which point towards the factors behind such partnerships.

In recent months, the publicly-listed logistics player BlueEX (listed as Universal Network System Limited) and leading financial platform Abhi deepened their finance and logistics collaboration with the fintech reportedly acquiring a 20% equity stake in the e-commerce delivery company. Just a few days ago, Retailpedia.PK reported that PostEx has obtained a Non-Banking Finance Company (NBFC) license allowing it to directly offer financial services to online merchants.

Pakistani publicly-listed fashion retail company achieves historic sales and profit

Image Pakistan Limited, formerly Tri-Star Polyester Limited, is a public limited company since 1990. Although it started out as polyester filament yarn business, the company transitioned its business towards manufacturing and selling value-added embroidered fabric under its own brand name "Image" over the past decade. Currently, the company operates 11 physical retail outlets and has a prominent online presence.

Through its latest quarterly financial report, published on the PSX website, Image has shown consolidated revenue growth of 50% during the nine months period ended 31st March 2023 over the same period last year. The reported Gross Revenue of the company is Rs. 2.1 billion with a 'highest ever' profit before tax of Rs. 432 million.

The Board of Directors of Image Pakistan Limited has attributed the positive financial results to its 'brand positioning' and its focus on local and cross-border e-commerce, for which it is operating dedicated subsidiary companies in Pakistan, U.K. and U.S.A and plans to start two more in U.A.E and Thailand soon. From the outside, it also appears that the company's attention towards high-quality products, enhancing brand value and prudent financial decisions have built a strong foundation for the company's continued success, despite economic headwinds.

In contrast to privately-held businesses, publicly-traded companies are required to publish their financial statements every three months along with other information that may be relevant for all its shareholders. Such transparency, although a corporate governance requirement, provides unique insights into Image, which is one of the only retail-focused businesses listed on the Pakistan Stock Exchange. The company's previous financial statements and annual reports are available on its corporate website.

Two new Carrefour stores to open by end 2023 to lift MAF total investment to PKR 11.5 billion

According to a recent news story, Majid Al Futtaim (MAF), the UAE group behind the Carrefour chain in Pakistan, has broken ground towards opening the hypermarket chain's 12th store in the country.

The latest outlet will be located in DHA Rahbar, Lahore while work is already underway on the eleventh store situated in DHA Lahore's Phase VII. Like all the others, both new outlets will be company operated with a timeline to open by end of 2023.

In January 2022, the UAE conglomerate was reported to have invested an additional PKR 1 billion on top its already invested PKR 9.5 billion till the time. Now a further investment of another billion rupees (around US$ 3.5 million) in its latest expansion will take the total to PKR 11.5 billion.

Later in December 2022, Hani Weiss - CEO of Majid Al Futtaim - mentioned in an interview that the company had also diversified its offering in Pakistan with the launch of its health and beauty concept, myli. The mono-branded presence, located inside both Carrefour outlets at Lahore's Packages Mall and Fortress Mall, offers a wide variety of quality products including cosmetics, fragrances, as well as hair and skin care.