Jarrar Shah is the CEO and Co-Founder of 24SEVEN, a grocery technology platform that empowers retailers with digitization and innovation. Through its POS, checkout and management solution, 24SEVEN Optima, supports these businesses in serving more than a million customers a day across the Middle East and South Asia.
The UAE has undergone remarkable economic transformation over the past few decades as a result of visionary leadership, strategic investments and its focus on diversification from oil-centric industries. Underpinning its success is the growth of small to medium-sized businesses that account for 63.5 percent of non-oil GDP. Whilst the benefits and rewards of digitization are widespread amongst different sectors, there remains a gap specifically in the grocery retail market.
Grocery retail can be defined in two categories – modern and traditional trade. Modern trade comprises hypermarkets, large and medium-sized supermarkets such as Carrefour, Lulu and Geant. Equipped with the latest and best technology, they currently account for over half of grocery sales in the UAE. Traditional trade such as grocery stores and corner shops still account for 44 percent due to proximity to communities and availability of daily consumables. Our research suggests that there are over 6,000 baqalas (grocery stores that are typically less than 50sqm in size). However, they face challenges embracing digitization due to the lack of access to affordable, simple-to-use hardware and software that plugs into the wider digital ecosystem.
We’re on a mission to revolutionize traditional trade in the UAE, unlocking the potential for technology to transform the conventional point-of-sale into a point-of-everything. Let’s explore four key technology drivers that will accelerate digital inclusion for grocery store owners.
1.Cloud-Based POS Machines
Traditional retailers often struggle with outdated and cumbersome POS systems that hinder efficiency. Cloud-based solutions offer real-time data processing, inventory management, and sales analytics, providing retailers with a dynamic platform to streamline operations. Innovative cloud-based approaches with handheld and affordable POS machines, ensure that even the smallest retailers can access powerful tools once reserved for larger enterprises. This allows them to compete more effectively in the modern market and opens up a data pipeline for other industries to access and add value.
2.API connectivity
Application Programming Interfaces (APIs) are software intermediaries that allow two applications to talk to each other, allowing for a seamless way to extract and share data across organizations. By empowering grocery stores with an API-first cloud-based solution, other businesses can plug into a network of neighborhood shops to access vital data. This can be immensely useful for financial inclusion as SMEs are often underserved and underbanked. This integration not only simplifies digital payments but also opens doors to a wider range of financial services such as loans and credit facilities from banks.
3.Big Data Enrichment
In this region, data is often referred to as the new oil. For traditional retailers, leveraging big data can provide invaluable insights for inventory management, sales forecasting, pricing and promotions. By analyzing purchasing patterns, retailers can optimize and enhance the overall shopping experience for its customers. For other businesses like fintechs and neo banks, access to consumer data that was previously not available can open up new markets to offer products and services like remittances, bill payments, digital wallets, buy-now-pay-later and government services.
4.Insights for FMCGs and distributors
Typically, traditional retailers buy stock from wholesale markets in bulk to maintain profit margins. Individual store ordering volumes are too small for large FMCGs and distributors to manage. By providing detailed insights into consumer preferences and market trends at a neighborhood level, it can enable these stakeholders to make data-driven decisions. The synergy between retailers, distributors and FMCGs creates a more efficient and responsive supply chain, reducing waste and ensuring that products align with consumer demand.
The transformation of traditional trade from a point-of-sale to a point-of-everything is not only inevitable but also an accelerator for economic and social growth. Fostering a holistic ecosystem that benefits retailers, consumers, and stakeholders across the supply chain embedded with financial services signifies a transformative leap towards a more inclusive and competitive future for traditional trade in the UAE.
