Having given Egypt access to the the USA's massive retail market and taking care of all of the logistics of online shopping for you, Edfa3ly.com is changing the way we buy. We talk to the founders to find out more about this unique business...
Before Edfa3ly.com was born we had very few options as to where we could indulge in some good ol’ fashion consumerism. Do we want to be barged about by swarms of sweaty teens in City Stars or similar malls, just to find out that the items we’re looking for in store are either sold out, or have never been in stock in Egypt? No. Do we want to go Downtown and pick up a pair of Abibos pants or a dodgy mobile phone from a kiosk? No. You don’t have a credit card so you couldn’t order online and even if you did, the import taxes they'd surprise you with by the time the item arrived at your door two months too late would be ridiculously extortionate. Edfa3ly.com, an online service which allows you to purchase any item from any website, by cash, seems like the most simple and brilliant concept for this market but, as we found out in this Scene Session, the journey Edfa3ly has taken to becoming one of the region’s biggest online shopping facilitators was not as simple. We talk to Ayman Elhakim (Marketing), Ahmed Mohamed (It & Development) and Mohamed Atteya (CEO) to find out more...
Ok, let’s start at the beginning – where did the idea of Edfa3ly come from and how did it come to life?
The idea started with Mohamed Atteya, one of the co-founders, who owned a company that imports laptops to the US. In Egypt the importing process involves a lot of red tape. They did the customisation for the laptops and then they started importing them to Egypt. We then decided that we would open up a store in City Stars but by then we started having some problems and had to close down. This, therefore, was what made us think of starting up Edfa3ly.
We wondered what start-up could work. We needed something with a lot of potential but minimal capital, and have it be a service that we already have know-how of. So Edfa3ly was born. It started up as a small Facebook group – the idea was that we were communicating with our customers mainly online in 2010. Here in Egypt there is usually a lot of difficulty with importing products and the duty to be paid is often a lot of trouble and costly. So we wanted to come up with something that would remove that hassle from the customer, such as the price of the duty, delivery costs, taxes etc. We are trying to simplify this process for the customers – all they need is access to the internet to browse these items and we calculate the rest and handle the strenuous importing process.
When you started where did you get your funding from?
We first started out as owners of a previous company and when it ended we took some cash from it – cash and assets coming to a total of $15,000. From those we bought a van, some motorcycles and things like that. These are what we decided we would be able to use to deliver these orders inside of Egypt. The van, however, was stolen on the 25th of January in 2011 so we were broke and didn’t know how this company would further be funded. It was an unpleasant situation but we gathered smaller funds and decided to feed the company although it was a challenge. The positive was that we had a good cash flow – we would take the money from the customers in advance for the orders placed on products that they wanted to buy. To begin, with we had some customers that were willing to try our service out and bought a little cash flow through word of mouth. The challenge to begin with was scepticism. We worked really hard just to preserve the trust that we have with the customers.
For example we had this really unpleasant, small office in Heliopolis which was literally just a room, with a tiny little bathroom that couldn’t even be entered. To the extent that I would literally get in the car, go home, use the bathroom and come straight back! So it was often misjudged by people when they would come and see it!
How did you manage to persuade them to pay?
Once they’ve already come inside the office they get too embarrassed to turn around and leave without placing and order – they don’t have any other option!
Say a customer wants a specific product like a laptop that isn’t available in Egypt like they want it from the US and can’t find it at all here. We can get it for them, and it's their only way to access these products.
If we order something, how long will it take to be delivered?
Our service at the beginning was taking from 2-3 weeks but now it’s around 7-15 days. But it depends on the website you're ordering from.
Who’s your target audience for Edfa3ly?
Ages 18 to 35.
People who don’t have credit cards?
There’s a barrier with credit cards especially with Egyptian banks. The credit card doesn’t work with many merchants so if you try to pay online you’ll realise that the payment isn’t always accepted. Therefore your payment method isn’t always compatible with a lot of websites. When you come to order from a lot of these websites they don’t always ship to Egypt, and if they do, it’s a much higher price than if you do it via Edfa3ly. If you buy something online to ship directly to Egypt it often needs approvals from the duty and is stopped a lot at the borders, so we take it upon ourselves to deal with all that hassle on your behalf. When you do it all yourself you do not know the overall costs of the charge of the duty and taxes that need to be paid and we do the paperwork for free. We often tell the customer upfront how much the duty fee is going to cost. If this product is arrives faulty for any reason such as if it breaks on the way, or if it was to come in a different colour, we usually insure against these problems. Say they were to send a different item from the one you had originally ordered, we would charge you for the shipping costs for just the gross weight of the product.
What is the overall charge for each transaction?.
We take 5% of the transaction.
In terms of logistics, how does Edfa3ly operate?
We have two warehouses; one in New Jersey and one in New York. You just place the order and it ships to the location and then that warehouse forwards the packages to Egypt. As soon as the plane lands in the airport we deal with the customs and paperwork and then take the items to our office and then we deliver those items to the customer.
Some things, like weapons, can’t be brought into Egypt.
And has a weapon ever been ordered before?
What are the most common products that people often order?
Clothes usually, then electronics, car spare parts and mobile accessories.
What happens if someone orders something and then they decide that they don’t want it anymore?
Well, they have to pay in advance.
What do you then do with the item, do you sell it on?
If the customer doesn’t want the item and there is remaining money, our policy is that after 90 days, they are fined for every day after that period until the product no longer has any value so then we can sell it on. We can either sell it in the US again or inside of Egypt.
Do you have any connections for the duty that needs to be paid? Basically, do you have wasta?
At first we were contacting the merchants and going to the airports and doing all that, going into all the hassle that the customer would normally have to go through. After that we decided that we would arrange to use a courier service. They are the ones responsible for collecting the package from our warehouse, take it to the airport and complete all the duty responsibilities and then deliver it to our warehouse here.
How many people do you have in your company?
Do you think your value as Edfa3ly as a company comes in your service or your database?
Do you use your database for anything right now?
Kind of. When we first started Edfa3ly we had a small amount of people so we didn’t have the right know-how in how to use a database and how to look at it or analyse it, but now we have Ayman who is responsible for the database analysis and comes up with useful data for marketing.
What is the weirdest product that has ever been ordered?
A lot of things can be seen as weird that are being ordered. Someone once ordered a screw. Just one single screw.
Has something embarrassing ever been ordered before, like sex toys?
It does happen sometimes. We’re supposed to filter the products before we go ahead and buy them and if it’s a product that we can’t buy, we cancel the order. But they are humans who order so we do get things like sex toys.
From an entrepreneurial side, what was the most difficult thing in founding this corporation?
We didn’t have any money and we started with nothing, not even people. Not even a team or even a website. So that was a huge challenge. It’s also a challenge competing with the offline market and trying to create access for our customers.
We do have challenges that aren’t in our hands to solve such as being able to outsource our delivery service. That means our service solely relies on their performance with how they deal with their tasks. If the courier were to lose, the customer will not understand that it’s nothing to do with Edfa3ly, but it's our responsibility.
Do you know roughly how many products you’ve delivered so far to date?
It’s thousands per month. Overall, we've had about 50k+ customers.
Do you have any competitors in your market?
Yeah. They see what we do and they imitate our service exactly. But definition of competition is too wide for us because we compete with the retail market, logistics market; we’re even competing with those who have a Facebook page selling clothes!.
Where could Edfa3ly be in five years time?
We want to develop our other portals, other than Edfa3ly. For example, we’ve been developing a new online shopping platform with productssupplied by suppliers from the US. The benefit is that there will be a large product range available; the catalogue will have about 200k+ products. We are also thinking about how we could expand in the GCC. Say we were discussing Kuwait. Kuwait has no duty fees whereas Egypt has 40% duty fees on clothes. If you were to purchase a t-shirt for $50, you would pay $120 overall, whereas Kuwait doesn’t have that. In Kuwait however there would be a huge gap because the retailers are very high there and life isn’t cheap.
Have any of you ever ordered from Edfa3ly, and what did you order?
Yes. We usually buy our electronics and clothes online.
Do you not feel like you’re taking away from the Egyptian economy?
No, not at all – yes we are exporting in dollars and importing from abroad, but at the end the customer was able to buy something from abroad through Edfa3ly for 1000LE which would cost 2000LE if he bought it here. We have therefore saved him 1000LE he will spend in the local economy.
Are there any products that you refuse to purchase for customers, aside from anything forbidden by law?
Person 1: We don’t order any products for customers that are religion-related, because if an item is shipped, like a bible, for instance, we can see that it may be ruined in the shipping process due to packages being handled unresponsibly.