It was three years ago that the American retail market experienced a change designed to drive more attention to the small businesses: the entrance of Groupon, a web-based company collaborating with the retailers to offer consumers discounts on various products. The timing suited all players in light of the financial crunch and rising unemployment.
For all those who follow the business world, the recent announcement by Groupon to go public with a $750 million IPO comes on the back of what many analysts see as the new technology bubble. While many have placed the $20 billion valuation of the company as an extreme exaggeration, especially in context to the loss making performance till date, the rise and popularity of the company and its services is of no debate.
With internet users growing exponentially in Pakistan, the number of start-ups has begun to mushroom slowly. While software and application development houses have been here since the late 90s, their core focus has been the developed markets of the West.
However, with a better connected middle class residing in the large urban centers of the country, a push is coming to use the web and other technologies as a gap-bridging medium in the retail world.
The statistics available officially announce the existence of over 3 million businesses in the country, with 98% regarded as SME. This reflects the numbers of many other Asian nations, where small establishments and family businesses tend to survive due to stronger ties and national culture.
In tough times, it is these enterprises that suffer greatly due to low revenue. While coupons have long been used by shop owners to get repeat business, the social networking boom is allowing for the model to be adopted as an ice-breaker.
Groupin (http://www.groupin.pk) has entered the Pakistani market by re-capturing the mechanism of its larger American counterpart. Initiating in Islamabad with a special on sugar, the company has appeared to gain acceptance within the business and consumer groups as more deals are announced.
Lahore made its debut recently with a special on petrol, and other cities are likely to follow. Incorporating variants for payment in an otherwise cash-oriented society, the company is trying to establish a hold with its service.
Such initiatives have to be admired especially in the context of the challenges that must be overcome. While entrepreneurship exists in many forms in this nation, very little encouraging force is available for those seeking resources to launch themselves.
In most cases, the owners or founders come from sound financial backgrounds allowing experimentation with otherwise wild ideas. Incubation facilities and science parks, which allow for guidance in the formative years of a new business, are absent, low in numbers or still in the learning process themselves.
This gives greater reason to encourage Groupin and other similar ventures, who dream to offer something different to the norm. In the socio-economic and political environment that we currently inhabit, stronger business-to-business ties and consumer-centric offerings allow for a winning scenario for all.