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CrediBook digitizes wholesalers through CrediMart, Online B2B Wholesale Marketplace
Running a wholesale store might look simple: buying in bulk from distributors and selling to retailers. But there is more to it than that when you look behind the scenes.
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CrediBook's founders with CrediMart customer (left). The start up recently closed its $8.1M Series A funding. (Courtesy of CrediBook)
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unning a wholesale store might look simple: buying in bulk from distributors and selling to retailers. But there is more to it than that when you look behind the scenes. Just ask Lamhot Sihaloho, the proprietor of Ashera Wholesale in Bandung, West Java
“It’s a laborious job, serving hundreds of customers lining up at the store while also managing thousands of products in the warehouse. We are used to doing things offline and manually, and so do my fellow wholesalers. It’s stressful, especially when the pandemic hit. No one came to the store. Sales dropped and the stock languished in our warehouse,” he said.
Lamhot is just one of approximately 200,000 wholesalers that supply a myriad of consumer goods and necessities bought and used every day by 60 million retailers in Indonesia. Most are run conventionally, not yet digitized in any way.
Lamhot then came across CrediMart, a digital platform that enables him to sell online and manage incoming orders easily. Lamhot works together with CrediMart in selling fast-moving consumer goods (FMCG) products to retailers on the CrediMart online wholesale marketplace.
“Orders coming from CrediMart increased my daily revenue by up to 50 percent. I used to only serve customers within 1 to 5 kilometers from my store, but now I can reach more,” said Lamhot.
CrediMart is one of CrediBook’s two flagship products aimed at wholesalers. The company, which was born out of a digital bookkeeping app, recently received US$8.1 million in Series A funding from Monk’s Hill Ventures with the participation of Insignia Ventures Partners and Wavemaker Partners.
Gabriel Frans, CEO and cofounder of CrediBook, explained that the funding would be used to expand CrediMart as it had seen a huge product-market fit since its inception.
“In the past six months, CrediMart booked a staggering 37.5-fold GMV [gross merchandise value] growth with more than 60,000 wholesalers and retailers joining, showcasing the need for the digitalization of wholesale-retail transactions in Indonesia,” said Gabriel.
CrediMart is attempting to replicate the success of Faire, an online business-to-business (B2B) wholesale marketplace based in the United States that has secured $1 billion in funding and is currently valued at $12.4 billion.
CrediMart Enables Wholesaler, Not Disrupting
In a statement on their decision to invest in CrediBook, Monk’s Hill Ventures highlighted Indonesia’s tremendous $260 billion market for non-agricultural micro, small and medium enterprises (MSME), but noted that wholesaler-retailer transactions that largely make up the market still operate inefficiently, with no digital presence.
Most of Indonesia’s conventional wholesalers only sell offline, and it is common to find long lines of uncomfortable customers in-store. It brought further headaches during the pandemic as sales also dropped by approximately 20 percent due to mobility restrictions.
Gabriel came across this problem firsthand while enhancing the CrediBook bookkeeping app with wholesalers, as they make up the majority of its active users.
“Wholesalers want to sell online but don’t know how to do it and are not sure if it’s an effective way to increase sales,” he said.
CrediMart managed to gain the wholesalers’ trust as it was able to bring vast amounts of orders coming from retailers shopping online through the CrediMart marketplace. Currently, it is partnering with over 50 conventional wholesalers across several product categories, such as FMCG, building materials, over-the-counter medicines and stationery.
“We’re not partnering with brand principles and don’t want to replace the role of conventional wholesalers in the traditional supply chain. We fulfill the retailer orders on our online marketplace from our conventional wholesaler partners,” said Gabriel.
In addition, CrediMart also provides a buy-now-pay-later payment scheme and next-day delivery service for the retailers, something that most conventional wholesalers were unable to provide before partnering with CrediMart.
On the other hand, Gabriel explained that digitizing wholesaler-retailer transactions must also involve changing retailers' shopping behavior.
“We have on-field sales representatives in over 40 cities across Indonesia that educate retailers on how to shop online on our platform. The combination of human touch and technology is important to maximize retailers' adoption and experience using CrediMart. As a result, retailers are responding positively and the retention rate has increased five times,” said Gabriel.
Going forward for CrediMart
As CrediMart rapidly grows, it plans to expand its service areas across Indonesia, especially Bali, Nusa Tenggara and Sumatra. It also plans to increase its collaboration with more wholesalers in more segments to add to its repertoire of product categories, such as food and beverages, fashion and household needs.
“We see a massive opportunity ahead in the wholesale industry due to the large variety of product categories that are still untapped. CrediMart solutions are category-agnostic, every wholesaler selling any products, not only limited to daily essentials or FMCG, can gain benefit from it,” said Gabriel.
While aiming to grow fast, Gabriel will be all eyes on the company’s unit of economics.
“We will always be an asset-light company, operating without warehouses to store products, for example.”
