Bangladesh's retail landscape is powered by millions of mudir dokan (mom-and-pop retail shops). These humble storefronts, equally ubiquitous in both urban centers and rural areas, are the primary nodes of commerce for most Bangladeshis. These enterprises, numbering over 5 million, contribute a staggering 30% to the country's GDP and fuel 97% of retail transactions. It's a $200 billion market that's projected to balloon to $850 billion by 2030.
Despite their economic importance across Bangladesh, MSMEs grapple with a trifecta of challenges: inefficient sourcing, opaque pricing and a chronic lack of working capital. The result? An incredibly potential sector limited by a hostile support ecosystem.
It's against this backdrop that PriyoShop emerges as a potential game-changer. Founded by Asikul Alam Khan and Dipty Mandal, PriyoShop has been building a comprehensive B2B ecommerce ecosystem designed to address the multifaceted challenges faced by MSMEs.
The PriyoShop Approach
PriyoShop's model is deceptively simple: a B2B marketplace that directly connects mom-and-pop retailers/MSMEs with suppliers and brands through a digital marketplace.
The platform's user interface, available in Bangla and accessible via a smartphone app or WhatsApp, is designed with the tech-wary shopkeeper in mind. A few taps are all it takes to browse over 2,000 products from 270+ brands, compare prices and place orders.
This addresses several pain points for MSMEs simultaneously:
For brands and suppliers, PriyoShop offers visibility into the fragmented MSME market. The platform's data analytics capabilities allow for demand forecasting and inventory optimization, reducing stockouts and overstock situations. This is particularly crucial in a market where brand loyalty can evaporate if a product is consistently unavailable.
PriyoShop's ‘asset-light’ model leverages existing infrastructure where possible-using suppliers' logistics networks or partnering with third-party delivery services-allowing for scaling without the burden of heavy capital expenditures.
Most crucially, PriyoShop is also tackling the challenge of financial inclusion for MSMEs. By recording transactions and order histories, PriyoShop helps create a financial footprint for businesses that have traditionally operated in the shadows of the formal economy. This digital trail serves as a credit score for these companies, opening doors to formal financing that were previously shut tight.
"We are not just facilitating commerce; we are creating economic identities," Khan asserts. It's a bold claim, but one that's backed by tangible results. MSMEs partnered with PriyoShop report easier access to bank loans, with some securing financing for the first time in their operational history.
The numbers speak volumes. Since its pivot to B2B in July 2021, PriyoShop says it has experienced a 15x growth in Gross Merchandise Value (GMV) and a 13x increase in revenue. The platform now serves MSMEs across 806 routes in Bangladesh, including major cities like Dhaka and Chattogram, as well as more remote regions.
The PriyoShop Advantage
PriyoShop offers a series of benefits to MSMEs:
Commerce: One-stop shop to purchase thousands of products from over 270+ brands, eliminates the need for multiple supplier relationships.
Logistics: Faster logistics support to help retailers grow 2x better. PriyoShop's delivery network promises to double retailers' growth potential.
Fintech: Credit line for MSMEs, including the innovative first ever CMSME credit card in partnership with LankaBangla Finance PLC and Mastercard. Post-sales, MSMEs can access credit lines from formal financial institutions, addressing the perennial issue of working capital.
DOOH: DOOH byChutney Ads, an innovative new vertical of PriyoShop, is a timely and directly engaging digital out-of-home advertising solution for ready-to-buy, demographic specific and intent-driven audiences. It provides MSMEs with impactful awareness and sales conversion through innovative digital display technology, real-time updates, and targeted content in a strategic and persuasive manner.
The results speak for themselves. PriyoShop says retailers using its platform report saving up to 20% on inventory costs and boosting revenues by a similar margin.
PriyoShop's Economic Impact
While the anecdotal evidence of PriyoShop's impact on individual businesses is compelling, the platform's broader economic impact deserves a closer examination. By streamlining the mom-and-pop shops/MSME sector, the company is not just improving individual businesses; it's also helping build a more robust, transparent and efficient economy. In the following section, we take a closer look at the broader impact of a platform like PriyoShop on the economy.
Market Reach: PriyoShop now connects over 91,000 MSMEs with 270+ major brands, significantly improving market access.
Productivity: PriyoShop claims that MSMEs leveraging PriyoShop's platform see an average revenue increase of 20%. MSMEs already contribute 30% to Bangladesh's GDP, a figure that has the potential to grow significantly with increased efficiency.
PriyoShop's intervention in the supply chain can contribute to unlocking this potential. By reducing operational costs and increasing revenues, PriyoShop can help amplify the impact of each MSME it touches. When extrapolated across the tens of thousands of businesses PriyoShop serves, this translates to millions of dollars in additional economic activity. As PriyoShop expands its reach to more of the country's 5 million mom-and-pop shops, the macroeconomic impact could be significant.
Financial Inclusion: The World Bank estimates that the credit gap for MSMEs in Bangladesh stands at $3.5 billion. PriyoShop's model has the potential to meaningfully narrow this gap. Early data suggests that MSMEs using PriyoShop are three times more likely to secure formal bank loans compared to their non-digitized counterparts.
This increased access to credit can have a multiplier effect on the economy. MSMEs can boost their buying power, invest in expansion, and increase their inventory, all of which contribute to economic growth. Moreover, as these businesses move away from informal lenders charging exorbitant interest rates, they retain more of their profits, further fueling growth and investment.
Job Creation: By empowering MSMEs to grow, PriyoShop is indirectly fueling job creation at the grassroots level. Moreover, the increased efficiency brought about by PriyoShop allows shop owners to focus on customer service and business expansion rather than mundane tasks like sourcing and restocking. This shift in focus often leads to improved customer experiences, further driving growth and potentially creating a virtuous cycle of expansion and job creation. As MSMEs expand their operations, they often require additional staff, creating employment opportunities in local communities.
Formalizing the Informal Economy: By digitalizing transactions and creating verifiable financial records for MSMEs, PriyoShop helps bring thousands of businesses into the formal economic fold. This formalization has far-reaching implications from improving tax base to data-driven policy making to attracting foreign investment.
The Road Ahead
PriyoShop's journey, while impressive, hasn't been without its hurdles. The platform faces the dual challenge of digital literacy among MSMEs and the entrenched interests of traditional middlemen. To address these, PriyoShop has invested heavily in user education and has integrated with WhatsApp to provide a familiar interface for less tech-savvy users.
Looking ahead, PriyoShop's ambitions extend beyond Bangladesh. The company aims to expand its B2B marketplace to serve one million MSMEs and strengthen partnerships with major brands to offer more exclusive products. The company says it aims to create an ecosystem where MSMEs thrive through sustainable practices and easier access to finance, driving inclusive growth across the nation and potentially expanding to other Southeast Asian countries.
