How to launch an e-commerce marketplace in Oman

This column is divided into two parts and explains in great detail what are the steps needed in order to get started with an online marketplace in Oman and the Middle East more broadly. Marketplaces have been popularised by Amazon and eBay in the late 90s and at the beginning of the 2000s. More recently, platforms like Alibaba have brought this concept to a global magnitude.

A dear Omani friend – let us call him Ibrahim in this column – has asked me to advise on an online marketplace project. He trusted my expertise in the fields and so he shared with me the principle of his new venture. After consulting him, he made some changes to the business model, so I thought of sharing the thinking process that I put in advising him, and hopefully, it will be of use for any other young Omani entrepreneurs who want to launch a new project during or after COVID-19.

Ibrahim told me that together with his cousin he wanted to launch a marketplace platform through which other entrepreneurs from Oman could have sold their products. Unfortunately, it is easier said than done.

Having worked on similar projects before, I immediately pointed out the challenges in structuring such enterprise in such a way that business can be profitable and sustainable in the long run. In a nutshell, if you were to take away only one idea from this column I would stretch that any marketplace takes more planning to get started than just setting up a website.

AVAILABILITY: First of all I have asked Ibrahim who was allowed to open a virtual shop in his marketplace. He answered that anyone could have opened a shop, but by doing so there is the main challenge in exercising quality control. It is very important to verify the origin of the goods. For example, some stores might sell items that are illegal. In that case, my friend Ibrahim could be legally in trouble, even if the products were not sold by him, but through his marketplace. Secondly, some virtual shops might not be registered through the chamber of commerce and industry, posing another problem of legality, as the merchant could be infringing the rules and regulations to attain and maintain a commercial license.

ACCOUNTABILITY: Then I asked Ibrahim who was going to deliver the goods. He said that he did not think about it yet. I see logistics as the single most important node to solve when launching any e-commerce project. Making a website is the easiest part of the project. Making sure that the clients receive the products that they purchased in a short period of time, is the element that defines the success of the venture.

This is the end of the first part of this column. In the second part we will analyse more about Accountability, Responsibility and having All Parties Involved.