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YourNextStartUp - #001 Local High Street / Business App

by George Field

A marketplace app for small - medium size businesses that promotes shopping with local brands, offering delivery services ect, paving the future and allowing short term work arounds to Covid.

😵Problem Statement
An overview of the problem and what the pain points are.
Independent & small to medium sized businesses are struggling due to covid-19 and declining footfall on highstreets. In towns it is even more evident where there are huge amounts of empty shops and business properties.

  • Lower footfall already leading to a decline in customers for high-street based companies.

  • Covid is drastically affecting cashflows & companies most affected, such as those in hospitality, operate on small margins, therefore have lower cash reserves. This means less leverage and a loss in business will drastically increase the risk of the company going out of business.

  • Uncertainty is causing global issues.

  • "dramatic and sudden loss of demand and revenue for SMEs severely affects their ability to function" - (OCED, https://bit.ly/36pn70R)

  • National Bureau of economic research conducted a survey of 5800 SMEs in the US and found that 48% have already closed.

To combat the issues stated above, businesses have been developing apps, to manage disruption caused by Covid. The issue is that to develop an app is a lot more difficult for SMEs due to the costs behind it.

  • Hospitality businesses have been using table order apps such as Odery.

💡 Idea
The idea, the meat(or vegetables), the main course.

The idea is to create a business that aims to solve the problems that are created as a result of the movement away from high street shopping and Covid. The core idea is as follows:

  • A market place style app that allows small to medium sized businesses to sign up and list their products, with a focus of building community around the app and an incentive to shop with local business.

  • In essence, imagine an app that is essentially a virtual high street where every local business is listed on it.

  • Location based so each area / town has their own list of businesses.

  • Businesses would be able to add offers and send out notifications via the app.

  • Essentially it can become a hub for SMEs to create a new online distribution channel to their customers without needing to invest in app development or an ecommerce website.

Main Value Proposition
For Businesses - Creates an online distribution channel where there are active customers & helps them to establish their brand online. Also provides them a way to cope with the falling footfall and a useful tool to get around the friction caused by the pandemic.

For Customers - A place to shop within their community online, allowing them to support businesses they love and access a more convenient way of purchasing goods and services.

📦Product
Potential product ideas & product opportunities.

A marketplace app that allows businesses to list their products and offers a place for users to shop with SMEs in their area.

It could also:

  • Offer Delivery (Arranged by the business) & Collection options to cater for different businesses to setup how they best operate and to meet customer needs. This way, a book shop in a local town could possibly do delivery runs in the morning to ship all books ordered by customers.

  • Possibly integrate feedback tools into the app.

  • Integrate a payment solution so that small companies can benefit from economies of scale.

📈 Market
What story is the market telling? Is there an opportunity here?

  • Local Marketplace apps are popping up and becoming very popular, showing that people appreciate these kinds of platforms.

Who are the main business customers?

  • Farm shops
  • Independent shops
  • small convenience stores
  • Cafes
  • Cottage Industry creators

Do people want to by from niche places in their town?

  • YouGov Found that 64% of people in the UK want to support local business and buy local products.

Supporting market trends

  • There is a huge intake of users flocking to local marketplace apps such as Shpock, LetGo, OfferUp & 5miles. Shpock for example has 10 million users in the UK.

Example

  • Deliveroo Marks and Spencer to provide essentials to households during the coronavirus pandemic.

🚚 Distribution Channels
Distribution ideas. How will you get the product and business offering in front of possible users & customers.

  • Communities within towns and areas could be of key focus here as people are genuinely proud of where they are from and like to support their area.

  • Local Facebook Groups, Local Podcasts and Meetups.

  • Local podcast / start a local podcast

  • Build and email list of local shops in your area & find who there customers are, then ask for contact information from them.

  • You can use branding and ask shops who use the app to have marketing materials in their stores.

🏷️Price
What scope for pricing is there? What are other products doing?

  • Charge per transaction (similar to stripes model)
  • Charge a monthly fee plus transaction fee
  • Negotiate different rates with different businesses (There is a lot of scope for - - price testing here)
  • Lead Fees
  • Listing Fees
  • Featured listings and ads

😱Challenges
Possible challenges and stumbling blocks.

  • It being a marketplace style app means you get the classic chicken or the egg problem 🤦‍♂️.
  • Building an online community around the app will be difficult but in essence - you are moving communities that already exists online.

🥊Competition
What competition will you face in this market place?

🗺️ Where to start
Where to start on the journey.

  • Start with your area, look for local community Facebook groups, newspapers, magazines, meetup events, places that you can meet with people who live in your area.

  • Go into businesses in your area and ask questions around these issues, I guarantee that they will be happy to discuss the challenges that they are going through right now.

  • Build some form of validation - It could be an email list, a FaceBook page or an MVP with Sharetribe.

🔬 Further Research
Further reading & links to useful content to help you get started.

🤦‍♂️But George...
A section for questioning myself.

But George, can't an SME just upload their products to amazon and sell on there? Yes, But then the business competes with every other business on amazon and no longer benefits form the community in which it is based & it now becomes harder to connect with customers who are in your local area.

But George, What about Deliveroo and other food delivery services? This ideas market positioning is that of community, buying from local businesses & supporting niche brands online. This however is not a food delivery app so most hospitality based businesses would be better suited to Deliveroo unless they are offering a different kind of experience.

Thank you for reading, I hope this is helpful to some of you, any feedback would be greatly apricated. Also, how can I add more value to my reports?

Full Report with graphs & images can be found here -> https://bit.ly/3iIp62D

George Field's avatarGeorge Field
on October 9, 2020
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