Online shop grows from one laptop order to Sh280m venture

When Ravi Soni came back to Kenya after living in the United Kingdom for seven years, he couldn’t understand why people didn’t buy stuff online, something that was common in the UK where he had studied and worked as a consultant in system administration for the HMV music group.

He started Ravenzo Trading Ltd in January 2009 after working for two years for a local IT company. The second reason for going into business was the fact that his salary could barely keep him and his wife afloat, let alone the child they were expecting.

The going was tough at the beginning. Kenyans just weren’t ready for faceless transactions online and building trust was a painstaking but necessary process.

“Many people thought it (www.ravenzo.com) was a con job. How can you order without talking to someone and it comes to your door? Others tried to con us. They’d order five or six laptops and when we delivered, try to rob us,” he says.

The Internet was still very new and most people didn’t own a smartphone and so knowledge of online shopping was limited. Financing was another key challenge.

Soni got his first order on the day he started the business, which he was running from his dining room table. It was an order for a Sh40,000 laptop but he only had Sh36,000.

From the get go, he had to learn how to build good relationships with vendors because banks were not willing to extend credit until much later when the company was established.

Fortunately, Soni landed a World Bank funded project in 2010 called Wezesha which was being run by the Kenya ICT Board (now ICT Authority).

The project recruited five companies to provide laptops at subsidised rates to registered students in both public and private universities.

The project aimed at empowering students to become digital literacy ambassadors in their communities.

“We were chosen because we were the only ones doing online trading, so the Kenya ICT Board used us as a retailer and also a designer for the portal aimed at university students and lecturers. We went all over the country educating students and getting them to buy online,” says Soni who is also an accomplished rally driver and the current defending Kenya National Rally Championship (KNRC) navigators’ champion.

The project ended in 2011 after supplying close to 15,000 of the targeted one million laptops, but by then Ravenzo was well established and today has 32 employees and two branches in Nairobi with plans to open six additional branches across the country.

Laptops account for 55 per cent of sales followed by smartphones and tablets which generate 30 per cent of revenue. The balance is from printers, servers and PCs. Corporates are its biggest customer segment.

The company’s turnover in the 2014/15 financial year was Sh280 million, a slight increase from the year before (Sh260 million).

Soni’s clients include NGOs like the United Nations, Food and Agriculture Organisation and World Vision; large corporates such as Safaricom and Kenya Airways, and petroleum companies.

“We offer end-to-end solutions. Other than providing a laptop, PC and printer, we can set up your whole office, do the structured cabling, CCTV and the biometrics,” he says.

Mr Soni is bullish about the growth of e-commerce in the country. “Kenya is braced for a big boom in e-commerce because apart from online shopping, the government is directing us towards e-commerce by changing the tax system to iTax which forces everyone to file tax returns online” he says.

Social media is another key driver of acceptance of online shopping.

“Today the younger generation is completely social media driven. This culture of virtual interaction, which is happening worldwide, is helping more people be comfortable with online shopping as they are Internet savvy,” he says.

Buyers are also more educated and walk into shops having already done their research online and know exactly what they want.

Soni also offers payment by instalments to employees and students in partnership with a finance company.