Economics lesson sparks idea for SA fashion brands online store
South African online marketplace for local fashion designers and brands, NOWNOW, is looking to spread its wings into neighbouring countries.
So says founder and owner Eohan Lakey, noting Nigeria, Egypt and Kenya as the next African fashion hubs NOWNOW is eyeing as it journeys towards being a worldwide player in the fashion industry.
“The reason we’ve chosen these specific regions is due to the fact that these are regarded as the main fashion hubs in Africa, including South Africa, thus allowing us to easily integrate into their existing industries.
“Our current goal is to ensure every fashion designer in South Africa makes use of NOWNOW as an effective way to sell, advertise and produce products. In order to do so, we are in the process of partnering with various fashion organisations and schools around South Africa to fully enforce the business in fashion.”
Founded in 2018, NOWNOW is the brainchild of 21-year-old Lakey, who came up with the idea for the platform during an economics lesson while in grade 10 at Rondebosch Boys High School.
As far as social media debates go, one of the biggest hurdles for South African designers, particularly smaller players, is competing with global brands. In addition, some consumers are prepared to pay big bucks for international brands but won’t do the same for local designs.
Lakey’s idea was to create a platform to act as an intermediary between local designers and customers, providing an online platform for designers to sell their products. The platform, he says, is additional to other ways designers currently sell.
He explains: “After assessing the current retail climate in South Africa, I realised we have an oligopoly in the retail sector, specifically fashion retail, [which] has high barriers to entry thus making it difficult for local fashion designers to enter the market.
“Our store was founded for the exact purpose to assist and grow designers and brands within South Africa. We have created a system which works with brands of all sizes but more specifically geared at assisting brands with small stock-holding quantities, as we don’t have a minimum stock quantity on our store.”
According to Lakey, NOWNOW has 12 local designers on its platform, including BRAhSSE, Throwaway Twenty, Iconic Black, IV Designs, McNasty&Co, Dean-E Collective and Yussus.
“NOWNOW partners with various fashion organisations to further influence the local fashion market. We collaborate with these organisations to fully enforce our stance on local fashion designers and brands.
“Our goal is to shift our local fashion brands onto more of an international platform by providing methods of shipping and fulfilment coupled with marketing techniques and advertising campaigns, which is expensive and unattainable due to cost, but with our model we have taken the world and industry standard in multi-vendor marketplaces and shrunk it down and moulded it to work with smaller brands and designers in an efficient and cost-effective way.”
Different from the rest
A 2019 study conducted by World Wide Worx shows online retail is expected to reach 1.4% of total retail in SA, based on an estimated R1 trillion spent via traditional channels in 2018. The study says the 2% mark is likely to be reached by 2022.
Further forecasts by World Wide Worx show that for the next three years, from 2018 to 2020, online retail sales will more than double from 2016, to almost R20 billion, a year sooner than originally forecast in 2016.
In SA, online fashion retailer Superbalist has made significant gains in the market. Last year, the Naspers-owned company revealed it expects R1 billion in private-label sales in three years.
Because NOWNOW specialises in solely providing customers with South African- and African-designed and -manufactured garments, it has been able to set itself apart from the likes of Superbalist, notes Lakey.
“Online marketplaces and stores are largely standardised, thus from an operational standpoint NOWNOW and Superbalist are reasonably similar. We pride ourselves on keeping everything home-grown in order to promote and drive the South African fashion industry.”
According to Lakey, the company makes money from a R200 subscription fee charged to the brand or designer monthly, a 12.5% commission fee and a R5 fulfilment fee per sale.
“We’ve compared and adjusted our pricing accordingly in order to best suit small and medium-sized designers and provide services far and beyond simply selling products online, such as photo shoots, advertising and production opportunities, which allow those designers and brands to sell online at a more cost-effective level compared to any other online marketplace and Web site creation option currently available in South Africa.”
The NOWNOW team is made up of four people working with the general operation of the business, a media team as well as a large group of affiliates and promoters that consists of 65 individuals.
The company has partnered with UAfrica for nation-wide distribution, while DHL handles international distribution.
“Since it started in 2018, we’ve truly grown with leaps and bounds. Although selling online, creating brand recognition and trust is difficult, we’ve been able to grow exponentially with continuously improving sales month-on-month.
“The biggest challenge which we’ve had to overcome has mainly been to get customers to trust the local brands, as well as pricing the products as competitively as possible, which usually means lowering profit margins with the goal of promoting and selling more products in order to grow on a continuous and sustainable level.
“Unlike a lot of businesses, our growth has been natural simply due to the fact that NOWNOW is such a unique business with such a unique product offering; this has allowed NOWNOW to capture the local market as well as consumers which have allowed the business to grow not only locally but internationally,” he concludes.