Catherine Mahugu was one of the entrepreneurs who also care about social impacts so she decided to set up a company to advance the standard of living of the surrounding population in her native country, Kenya. Over the years, she saw that women throughout Kenya have made money by making jewelry but the global market is a complex market. Middlemen often control access, and that limits the earning potential of these craftsmen to be more developed.
In 2011, Mahugu who was a businessman thought that technology could help realize her dream to advance the living standards of craftsmen in her country.
Armed with a bachelor’s degree in computer science, Mahugu then invited to work with two businessmen from the United States namely Ella Peinovich and Gwendolyn Floyd. They started building Soko, an e-commerce platform where artisans can sell their jewelry to consumers around the world using only cellular phones.
Catherine Mahugu and Soko
“This is a brand that helps create a better world,” Mahugu said of Soko, and she revealed marketing knowledge in her description. Mahugu said the Soko platform was independent of traditional business models by offering women at the beginning of access to the supply chain to the global market. These craftsmen don’t need computers, Internet access, or even bank accounts, they only need cellphones.
Artisans register on the website, then upload photos of products to the Soko e-commerce platform. When a consumer buys an item, Soko then sends a courier to pick it up and send it directly to the buyer.
Mahugu’s approach has proven popular. In 2014, more than 1,000 artisans were registered on the Soko platform and they have sold 42,000 items to consumers in 30 countries around the world. Moreover, their average household income grew to reach 400 percent.
Catherine Mahugu and the Challenge Faced by Soko
While the numbers explain the company’s popularity with craftsmen, Mahugu said that she had faced real challenges in improving the company. This is the challenge she is talking about and the solution used by the team at Soko, which is the infrastructure that has failed to do so far.
“We have an in-house logistics network just to compensate for the lack of infrastructure in the form of transportation in Kenya and incomplete addresses,” Mahugu said.
The service is ultimately unreliable. Power outages and internet outages make coordination difficult, especially since many craftsmen live in rural areas with less power and connectivity. As compensation, Soko has developed a robust operational tool to run the online model. “We have been able to apply these tools through offline social networks,” Mahugu said. These tools mean that Soko can function and keep running even when electricity is in the area goes out.
Another challenge is the slow adoption of technology. “The culture of e-commerce in Africa has not developed as in developed countries,” said Mahugu. Soko receives cellular money only to overcome the problem of mistrust of online payments. The company also helps resolve disputes through social media. These methods provide a positive customer experience so they still want to buy works from artists through Soko.
Soko hopes to expand the platform to craftsmen in other African countries, not only in Kenya. Mahugu said there are key indicators whether a country is a viable market for e-commerce platforms. These include the availability of mobile money, the rate of adoption of new technologies, the reliability of shipping services, the quality of existing infrastructure, and government policies towards entrepreneurs who support this.
“Internet connectivity has only revolutionized the way businesses in Africa operate,” Mahugu said. To be successful, entrepreneurs must be able to follow the flow of change and innovation, not against it. “Thus Catherine Mahugu explained about her dream of raising Soko
