Taking online shopping to the village

 

Products2U aims to bridge the gap between rural and urban economies.

PETALING JAYA: Even as Malaysia marches relentlessly towards greater digitalisation across the country, the disparity between urban and rural areas continues to widen.

The 5G technology may already be taking root in areas such as the Klang Valley, promising faster accessibility for businesses, but a vast majority of mom-and-pop shops, especially in the east coast of Peninsular Malaysia, continue to operate on a model that has seen little change from decades ago.

Farhan Khairol Anuar saw an opportunity in this inadequacy. In May 2021, he launched Products2U, a start-up to bridge the gap between the rural and urban economies by connecting mom-and-pop shops to the digital economy.

“The objective was to give the under-served offline communities easier access to products and services that were not otherwise available to them,” he told FMT Business.

Farhan, who is Products2U CEO, said what he envisaged was to connect two stakeholders — the product supplier, which included manufacturers and wholesalers on one side, to the dealers, comprising retailers such as mom-and-pop shops, on the other.

“We reach out to them by knocking on doors. We have 50 personnel who we have deployed around the country to take on this task,” he said.

“We show these small business operators how they can benefit from using our app P2U, how they can sell products that they do not even have in stock yet, and services that they have never been able to offer before,” he added.

As an example, Farhan cited the case of Mak Cik Kiah, who sells sundries from her shop in a kampung in Terengganu.

“Mak Cik Kiah’s customers mostly do not have access to the internet so online shopping is not possible. However, with P2U, she can become the shopper for them, buying on their behalf items that she does not have in her shop,” he said.

Products2U now serves more than 1,500 businesses, ranging from mini-markets and sundry shops to warungs, roadside stalls and reseller agents. “We now have about 1,200 active users,” he said.

The P2U app enables businesses to expand their range of products and services offered to the local community. Apart from a variety of products, they also offer services such as utility bill payment, digital loan application, prepaid gaming credits, affordable medical insurance as well as the convenience of shipping their products.

Farhan said the mom-and-pop shops that offer products and services through P2U are paid commissions of 25% to 30% of each sale. They also get free marketing material.

It is also easy to use. A dealer only has to download the app and register to get on board.

Upon approval, a dealer will be able to sell the products and services listed on the app and perform transactions on behalf of the the community they serve.

Dealers will also be able to track transactions and check their profits on the app.

Farhan said Products2U has seen significant revenue growth of 7% to 10% month-on month since it was launched.

“This is only the tip of the iceberg. There is a lot more that we can do for the under-served offline community,” he said.

Farhan pointed out that this market was worth US$100 billion (RM426 billion), but online transactions account for only US$20 billion (RM85.3 billion).

“This is a huge potential that we want to tap. There are many products that have not reached the under-served market, which is why we have embarked on this journey,” he said.

Chief technology officer Faez Ridzal Hasnan said Products2U reached out to FMT Media Sdn Bhd when it wanted to expand, and was thrilled that the media company had responded with an investment.

Accounting firm Nexia and venture capital group Winacore Capital are among the other investors. Faez said more are in the pipeline.

For more information, visit P2U’s website here, https://products2u.my/. - FMT