Mobile trade for small entrepreneurs
Cross-border trading in Southern Africa can be tricky, with red tape hindering the free-flow of trade and transport routes not easily traversed.
Seeking to overcome these challenges, South African Suzana Moreira launched moWoza to assist cross-border traders access goods that are often transported into rural areas.
Her project, set up in 2012, is a combination of two words: “mo”, the short form of mobile, and woza, the Zulu word for “come”. The name communicates that the project uses mobile communication in its efforts to enhance trade.
“I decided I could do something to help the many thousands of micro-entrepreneurs from Southern Africa with moWoza,” Moreira said.
“We source basic, essential and everyday products for micro-entrepreneurs, allowing them to place orders via text message and pre-pay using their mobile wallets.”
Traders are able to order goods via mobile phone from moWoza, pay for the goods electronically, and the company’s trusted taxi distribution network delivers the consignments. Traders are also able to negotiate bulk discounts.
The business focuses currently on traders in Mozambique and Malawi. Its partners are a Mozambican mobile phone network as well as informal cross-border trade associations.
Moreira said her model could be replicated throughout the developing world where informal traders struggle to negotiate troublesome trade routes on their own.
Her company ensures logistics are in place to grow businesses, while ensuring rural consumers have access to goods.
“Seven out of 10 Africans still live outside urban areas. Many live in areas so isolated that it is only through informal networks that goods are distributed,” said Moreira.
“But the goods that are available at local informal markets are much more expensive than in the larger cities. Access to reasonably priced goods remains a huge problem across the region.
“More work needs to be carried out, from informing micro-entrepreneurs of custom procedures, providing financial access, to increasing the exposure to digital business alternatives.”
Moreira wants moWoza to improve conditions for cross-border traders.
Through the network, she has created opportunities for Mozambican and Malawian informal cross-border traders to voice their opinions. These results will enable the World Bank to work at a regional government level to improve cross-border trade for micro-entrepreneurs.
“We have also facilitated workshops with governments, where informal micro-entrepreneurs discussed the positives and negatives of trade corridors.”
Moreira said research from the World Bank shows that 43% of trade in sub-Saharan Africa occurs via informal, inefficient, corrupt supply chains. Traders also have to travel for days to source affordable food and other essential products.
“In the short-term, small businesses and the community benefit from informal trade, but over the long term relying on inefficient supply chains is preventing socio-economic progress,” she said.
The three informal trade organisations she works with in Mozambique and Malawi have at least 250 000 trade members.
“I am about to launch a campaign to inform traders about the correct importation tariffs and duties, using text messages to inform them, since that is how we connect with them,” she said.
The initiative intends to raise awareness of trade-related issues and procedures that informal cross-border traders and custom officials need to follow.
“In Africa, the informal sector is huge and more people should be redesigning systems to deliver convenience to this demographic,” she said.
“We offer a cost-efficient alternative to long and costly journeys, stopping back-door payments to corrupt custom officials and expediting delivery of goods while providing affordable, quality products.”