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Start-ups as hope for retail

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To: 03/08/2022 18:11

Traditional retail has suffered for years from online competition from large companies. Young companies are trying to bring what small local businesses have to offer on the Internet.

David Eisenbeis founded the “alocalo” platform together with students and a professor from the Saarland University of Applied Sciences. The young company wants to offer a regional alternative to Amazon, Zalando & Co. In doing so, it wants to save many retail jobs while leaving power to the retailer. He can then continue his normal activities and does not have to submit to the strict guidelines of online platforms.

“Amazon for local commerce”

The heart of the system is a plug-in, i.e. a program for the web browser. If you search for a specific product on Amazon, for example, the program automatically finds all nearby local retailers who have it in their range thanks to artificial intelligence. Ideally, the customer can then order it on site in a few clicks or pick it up immediately in store. Even the big multinational shipping companies are not that fast.

The idea is also easy for retailers to implement, says Frank Hälsig of the Saarland University of Applied Sciences. The expert sees alocalo as “in perspective the Amazon of local commerce”. With EU funding of €2.3 million, the technology is now even more refined.

Fewer and fewer owner-operated stores

As of 2015, there were almost 300,000 owner-operated retail stores. Experts estimate that there will be 231,000 left by the end of this year. This means that more than one in five stores would have closed within a few years. The reasons are high rents, pressure on prices and difficulties in finding a successor. What’s more, a full two-thirds of stationary retailers don’t even make ten percent of their sales online. alocalo wants to change that.

The platform has just started and has found the first 100 local business partners. Today, the company wants to expand rapidly throughout Germany. Because the wider the offer, the more attractive the platform is for consumers. For alocalo founder David Eisenbeis so it’s very important “that we really are significantly cheaper than Amazon. Amazon is extremely picky when it comes to reseller support.” The American group takes up to 15 or 20% per product as a sales commission from the reseller. Alocalo, on the other hand, requires 4.8%.

E-commerce is experiencing double-digit growth

Many large online marketplaces are currently carrying out similar activities, explains Bastian Popp of the Institute for International Business and Marketing at Saarland University. This does not make it easy for start-ups like alocalo. But e-commerce is booming. Sales have more than doubled since 2015. For this year, the German Retailers Association expects further double-digit growth.

Even offline, the web giants are now cashing in correctly: with vouchers that are mainly purchased in stores. The voucher market is estimated at three billion euros. But here too there are attempts to break the supremacy of Amazon, Zalando & Co.

Heidi Houy has launched “keeplocal” with her own vouchers, which can be purchased online, in stores or soon at gas stations. This should allow customers to shop in as many local stores as possible – so far in Saarland, Rhineland-Palatinate and North Rhine-Westphalia. The coupons will soon be available throughout Germany. And next year also in Austria and Luxembourg.

A matter of visibility

Keeplocal wants to grow rapidly this year. There are no fees for customers and dealers. Because the economic model is based on the observation that a small percentage of vouchers are not redeemed. It is essentially the fees that maintain local life.

From regional vouchers to platforms giving stationary retailers better visibility on the internet, there are regional alternatives to multinationals. Ultimately, the decision is up to the consumer.

The business magazine ARD plusminus reports on this topic today at 9:40 p.m. in the first.

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Source www.tagesschau.de

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