Notes

On the web Classifieds Portal in Uganda? Who Would like to Become a Millionaire?
Outside Looking Within

I was minding my own company as always on Myspace (liking every unique comment and reading every link) and even then I saw an advert on the side bar regarding an online classifieds portal called dealfish. co. ug. I clicked on typically the link and it also had taken me to the site which explained I can post some sort of free advert. I immediately created the advert for this website. I received an error communication: "Sorry www website addresses are not really allowed. " We were very upset and sent the email to them querying this and they informed me that they don't accept the classified adverts to feature a web handle reference. Well less than fortunate for them, I uncovered Kampala mart. com It's when I knew that finally the particular internet revolution is usually taking place throughout Uganda. Online classified portals like craigs list. com and gumtree. com, the biggest in the UK have been around for some time. In Uganda, these are beginning to take off big time because involving two very crucial things:

1) The african continent is beginning to eventually get coupled to the relaxation of the globe via huge fibre optic cables getting laid under the particular sea all over Africa.
2) Mobile phone system companies still give cheap internet in order to their customers prove mobile phones which include using 3G technology.

Internet and the particular opportunities available to a good internet entrepreneur are incredibly serious that it is being projected that based on a great article I examine at wired. company. uk ("get wealthy move to Africa")] Africa may well soon have their first internet billionaire, Certainly and immediately tell you why to invest in this sector in Uganda but first;

THE PARTICULAR CONS(of course)

1. Internet stability and usage in Uganda

Usage and computer illiteracy

Whilst it is well and even good that our web usage keeps growing increasingly by the working day, t here still continue to be lots of people who happen to be below the poverty line, are personal computer illiterate and/or cannot afford to have web. A large portion associated with people still gain access to internet from workplace rather than house which can impede the ease aspect.

Throughout the UK for example internet usage is now over 82% of typically the population. Almost everybody has internet within their home. By comparison in Uganda, it truly is about 10%, however it is growing significantly mainly because as per TERSEBUT statistics, internet transmission in Uganda offers grown in jumps in bounds. Throughout 2000 only 0. 1% in the population had access to net. It was nonetheless low in the year of 2007 where only 2. 5% of the particular population had world wide web but it has since then significantly enhanced to over nine. 6% in the new year!

Stability and expense of internet

World wide web stability in Uganda is very complicated. Often times internet is definitely slow and wherever it is not necessarily slow that is expensive. This particular of course is definitely changing but until then, this remains the main hurdle for potential users. I however count on that with raising internet on mobile phones particularly with the telecom companies going out 3G, in that case this shouldn't become a difficulty especially if the online classifieds portal invests heavily in a cellular version, that will be, one that is incredibly easy to view on mobile phones plus not just the particular smart phones. This is critical mainly because mobile phone usage including internet is probably going to be the next revolution in Africa and Uganda within particular. It previously is under way anyway.

2. The small fish will get going after you....

I actually afterwards set away the cost associated with start up for some sort of serious online classified listings operation but the actuality is that this kind of business could be done from a laptop in somebody's bedroom. This will be a typical "briefcase" type of organization.

Low cost These types of days numerous web hosting companies provide you with a free website and also allow you in order to host your website with regard to free say with regard to 6 months. That they will furthermore supply you with some sort of free domain. The particular cost of this particular all? �8. 99 for 6 several weeks. 1and1. co. uk for example offer you just such a package.

Therefore with a little the help of a programming good friend if you possess no IT information, you can established your website in addition to have it organised for free!

Concerning advertising the web site to achieve Ugandans, easy! It comes with an advertising wave happening and it is no wonder that Capital FM, the best Ugandan FM station is dropping advertising revenue [if you happen to be to believe a new 14 September 2011 Redpepper article on a single. ]

I are not able to touch upon the accuracy in the figures within the Redpepper post but they will be certainly right inside the sense that worldwide advertisers are usually shifting from classic advertising of stereo, TV and magazines. The reason is definitely simple; with on the web advertising, you may measure how a lot of people are "seeing" your advert. You therefore can fixed an advertising spending budget and only pay for people who are considering your advertisement because if they are usually they will click on it, hence "pay per click". In the event you didn't know this specific, you are many years late to the particular party! This is the way Yahoo and google has been making its money in fact it is likewise how Facebook makes its money.

Now how may you advertise your web site to Ugandans? Nicely Facebook includes a "clever" computer. It understands where an end user originates from and thus when you pick to advertise with these, they will notify you how many "Ugandans" you will get to with the maximum advertising budget. They furthermore give you the rough estimate of a good lowest advertising budget you may set. You may however choose what you can pay for.

In the basis involving the above, you may therefore set your advertising budget in Facebook at actually $2 (they will certainly simply captivate advert to less people). If you arranged your advert to perform for 30 days and nights, that is $60 which usually at an exchange rate regarding $1 = Shs 2, 605 computes at Shs 156, 300 a month.

You can therefore formally start this enterprise with your aged laptop and just Shs 156, 3 hundred!

It really is a good issue right? Yes, nevertheless so is it for everyone else. You could therefore count on that there will get many of these kinds of quickly and We mean SEVERAL OF THESE ARE GENERALLY COMING SOON, ABOUT TO CATCH THE ONLY ONE PARTICULAR WHO WANTS TO GET RICH (OR DIE TRYING).

Why don't observe how many on the web classifieds portal We can find with Google search:

dealfish. co. ug
kampalamart. com
kwatadeal. com
classifiedsuganda. com
easyuganda. net/about-us. htm
tagsaleuganda. com/
majestysdirectory. com/
And counting!

Now the catch It means therefore that for the investor, you include to ensure the site stands out from the audience so as in order to attract both advertisers and visitors.

A person will therefore have got to employ numerous marketing strategies thus that your website has sufficient consumers coming there after which you can entice in the advertisers (where did you think you were will make money from duh? ). Gumtree the main online classified web site in the UNITED KINGDOM for example has got clear statistics on their website to show their customer reach. This specific information should be enough to convince a good advertiser.

Alternatively you will need in order to consider making a specialized niche. autotrader. co. ug for example is one such site. They have got focused solely on cars.

3...... the top boys are coming too!

Unlike a conventional business model claim farming or minicab business, online organization are not spot dependent and for that reason whilst the potential buyers and sellers may be in Uganda, the organization owners may end up being foreign. After all, hosting a site doesn't need a good Ugandan presence and even neither does "pay per click" promoting. As an investor with this sector, a person can therefore assume that as soon as you start off, you will end up being competing with typically the really big species of fish who within their international expansion will the majority of certainly look in order to tap into this market. Can you for example compete with Your local craigslist ads or eBay ought to they elect to emphasis on Uganda? How about Schibsted? Not read about them? Well you should know them because with this business, they will are not slumbering, they are expanding.

Even dealfish. corp. ug for instance is the "Ugandan" branch of the Dealfish brand which usually finally count is usually in 9 nations around the world.

I will not get surprised if in fact local newspaper titans like The Fresh Vision(with Government's serious pockets) and The particular Monitor (which is usually backed by the particular mighty Nation Media Group) soon venture into this sector. Fresh Vision for example of this gets the enteruganda. com portal (under structure as at day of the article) which can easily end up being spun into a good online classifieds website and the Keep track of has an on the internet business directory which can easily have a new classifieds section.

As a result the business is usually expected to end up being tight but could it be the real McCoy?

And Now the BENEFITS

1. Excellent profitability and return on capital in under a single year

And at this point looking to find out why many people are looking to proceed into this sector. I define under my projections associated with the estimated productivity, start up expense and return on capital that may be achieved in this sector.

I need used the Kampalamart. com website as a model. Their model is this; Customers can post ads for cost-free. Some can nevertheless choose to improve the visibility of their own ad to about three locations on the website: The particular top most hysterical The side the flag or A featured ad banner on important internet pages

These 3 prominent places unlike one other ads within the myriad of adverts in the types cost money. These types of are those financing the company and it is this model I use to show the particular profitability of this particular sector.

You should of course remember that there are additional models of having revenue:

You could by way of example charge for certain categories. For example on chewing gum tree. com where rentals and work postings(by employers) are charged. You can certainly use a pay per click principle whereby certain "adverts" are targeted to specific customers dependent on their on the web behaviour (behavioural advertising).

I therefore decide my analysis like below. In typically the model below We present two somme columns. The existing position as well as the projected position.

I job that there might be a 60% growth in revenue and a 25% increase in costs. The expansion in revenue is founded on world wide web usage growth inside Uganda between 08 and 2010 as per ITU figures.

Analysis 1: Success information

(exchange charge of $1=2, 605 used)

Total income:

Current: 5, 522, 600. Projected: 8, 836, 160

(based on 6 top rated banners, 6 side banners, 16 showcased ads each incurred at $200, $22.99 and $20 monthly, respectively)

Expenses

1 . Rent and services charge: Current: one, 237, 375. Estimated: 1, 237, 375.

(Based on 25sqm in worker's home, a "grade A" building which demand rent at concerning $10-$18 per sq . metre(psm) and support charge of $2 psm. )

2. Hosting: Current: thirty eight, 859. Projected: Simply no transform

3. Wage: Current: Shs. 1, 800, 000. Expected: 2, 250, 1000

(3 staff comprising of manager/IT staff and office administrator)

4. Marketing: Present: 656, 300. Projections: 820, 375

(including Facebook advertising plus other marketing techniques)

5. Transport, conversation and other: Present: 800, 000. Projected: 1, 625, 500

(Estimated)

Total Expenses. Current: 4, 530, 534. Projected: some, 969, 609

Total Monthly profit (revenue less expenses). Present: 992, 066. Projected: 2, 866, 551

Total Annual Profit. Current: 11, 904, 792. Projected: thirty four, 398, 612

Evaluation 2: Start way up capital information

1. Web development: 3, 907, 500

(estimated in $1, 500 intended for a good internet site to support online classifieds and e-commerce)

2. Rent(6 weeks in advance): Shs 6, 642, 750 3.

3. Business office equipment: Shs. eight, 495, 000

(computers, office desks, EPISODES, internet installation, multiple purpose machine, legitimate costs, signage) four.

4. Miscellaneous: 849, 500

Total: Shs. 19, 894, 750

Return on funds (Total start way up capital/profit): Current: one. 67 years. Expected: 0. 57 many years

second . Gain about eventual sale

A new savvy investor will tell you that will if you would like to find wealthy quick, begin a business using the end in thoughts. Basically, prepare regarding when you can eventually sale that. When you ultimately sale the enterprise you have successfully built, you may earn money from the acquirer who will most probably be some of those big boys like Schibsted? Not heard about all of them? I told you, you need to locate out about them!

3. Low start up costs

I did mention as 1 of the advantages the lower start upward cost having the ability to outcome in a lot of competition. In case you are one serious investor, this however shouldn't deter you. It have to only spur an individual into action. The low costs is going to be your advantage.

A person therefore don't automatically have to start out with the Shs 20m in accordance with the information above. You can start like I mentioned with as little because Shs 156, 300 and go upon to become effective so go on, so what are you waiting for, do we not all wish to be billionaires so freakin' bad?

SUMMARISING AND THE FINAL WORD

Initial the numbers.

On the basis of my analysis:

Funds investment(A): Shs 19, 894, 750

Income per year (revenue excluding all expenses) (B): Shs 14, 904, 792

Go back on capital(years to get capital rear or A/B) will be 1. 67 many years

If you glimpse at 60% progress, you can however look to recover the investment inside 0. 57 years!

Now the fundamentals you must obtain right before investing.

Excellent website design and style. You need in order to choose a good internet site that will make it effortless for users. An individual need to bear in mind that only a few Ugandans have internet at home and therefore will most likely be browsing in office, inside an internet coffee shop or prove telephone and so an easy design which may support mobile phone browsing is most probably

Suitable aggressive marketing. A person will need in order to move fast or even smart to catch the market with different marketing strategies otherwise your web site will certainly get drowned inside the crowd. I are not necessarily saying splash out on huge magazine adverts(which we know cannot necessarily be measured for success). There are many techniques for example a new free press history, interviews, article advertising, Facebook or myspace advertising et approach. A clear target audience. Who do a person want to reach? You need to be able to know who a person are targeting plus then go upon to build up your services get back client throughout mind. An example My partner and i gave is automobile trader. co. ug.

FINAL EXPRESSION

Regardless of the threat from the big competitors coming, this is really among those sectors where even the little dude can win in addition to embark on to turn out to be the next Google, the next Fb. You don't have to capture some sort of huge percentage of typically the market to be successful. Kampalamart. apresentando for example at the date of this particular article had concerning 388 Facebook enthusiasts. If this represents their market reveal of an estimated 304, 000 Facebook users in Uganda[early 2011] then simply this represents simply 0. 13% associated with the market ALTHOUGH from the research above, they would already be lucrative! Need I state more, go upon GET RICH (OR DIE TRYING).

Plus now the please note: While I have got taken procedure for exploration this information and also based on my personal experience, you have to not rely about the information given in this article to base your current investment decisions. An individual should seek company advice from a professional knowledgeable of the certain circumstances. I shall therefore not get kept responsible for virtually any loss you may well incur when appearing on this information.

Over 8 years I possess worked with several clients offering audit, accounts, taxes and advisory throughout sectors including agriculture, mining, entertainment, economic services and technologies. My client collection in Uganda, Typically the Bahamas and The particular Channel Islands, United Kingdom has both equally been diverse in addition to this experience offers given me some sort of "well rounded" view of business.
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