Shemach is a B2B e-commerce platform that connects FMCG retailers to suppliers across Ethiopia. Shemach enable retailers to order their products through their eCommerce platform and receive credit facilities.
We met with Dawit Nigusu, the Founder, and CEO, to learn more about how Shemach is connecting FMCG retailers and suppliers in Ethiopia and beyond.
Can you share a bit about yourself?
My background is in Software Engineering and I’ve been working as an app and software developer for Ethiopian startups and the Food and Organization Agriculture of the United Nations as a National IT Analyst. One of my responsibilities is managing a project that mainly focuses on small households within retailers and that’s one of the things that helped me see the problems Shemach is trying to solve at the moment.
What inspired you to start Shemach, and what problem were you trying to solve in the FMCG industry?
What inspired me was that I cook by myself when I was living alone and whenever I needed foodstuffs, I had to visit the nearby retail shop to get them. At a certain point, when I passed the shop and I saw that the shop was closed. I was curious why that happened. I got a chance to interview the owner of the shop to get an insight into why the shop was closed and she said one of the biggest challenges running her business is that she needs to visit the market which is 3 to 4, miles away from her shop to restock. Also, she has to pack and transport the goods back to her shop. This is very expensive and the profit margin is very low that she couldn’t run her shop efficiently and finally closed it. I was curious and since then, I started doing research and interviewed multiple retailers to get an insight about how they’re running their business.
How do you see Shemach contributing to the growth of the FMCG industry in Ethiopia and beyond?
Whenever we’re doing business, we try to add something that isn’t currently in the market. There are a couple of things we provide for the market to grow. The first thing is that we leverage the right technology to revamp how the FMCG is distributed currently in Ethiopia and Africa. There are traditional ways of distribution that are dominant in the market that aren’t cost-efficient, which are very cash intensive, time-consuming, and require high manpower.
When it comes to the traditional way of distribution, you need to go to every shop whether there are orders or not, and that wastes a lot of time and resources but when it comes to Shemach, we receive orders on multiple channels like our app, call center, and even the telecom channels and that put us in the right spot to cut the logistic cost because we don’t need to go to the shops without getting orders.
Why did you incorporate Shemach in the US?
The reason for incorporating in the US is that foreigners aren’t allowed to invest directly in Ethiopian startups if the startups are incorporated in Ethiopia. We also incorporated in the US because we want it to be easier for us to go international and for investors to invest directly in US startups so as to avoid bureaucracy and other things when investing in Ethiopian startups.
How did you hear about Sidebrief and why work with them?
Sidebrief was recommended to us through one of our investors and we decided to work with them because we realized that a lot of East African startups already incorporated with the help of Sidebrief which also prompted me to seek Sidebrief’s help in filing our taxes and EIN.
What was your experience with Sidebrief like?
Sidebrief’s service was amazing and if we had to do it ourselves and it can be stressful and time-consuming. So, with the help of Sidebrief, we were able to file our taxes, and do other necessary things.
Also, Sidebrief was very responsive which really surprised us.
Any advice for other African entrepreneurs?
My advice to other African entrepreneurs is to be focused on their business because building a startup isn’t easy and most people find it difficult to build a startup. Try to be focused on your customers and ensure that you’re solving a real problem and there’s absolutely no reason that you won’t grow in Africa and even internationally.