Seeds for Africa is a niche ecommerce business tapping into one of the biggest trends still in its infancy: growing your own food.
Grant Muller launched Seeds for Africa on bidorbuy
with a few imported chili seeds because he could not find what he was looking for locally. Four weeks later, he was able to resign from his job and focus full-time on his ecommerce business. 18 months after that, he built his own Shopify
website and now, 11 years later, the business stocks 3 500 varieties of vegetable, indigenous and exotic seeds.
Grant recognised that more and more people would want to grow their own food in the future, from small balcony pots to much larger vegetable gardens on small holdings, and he believed he could build a business to match that need. His exponential year-on-year growth has supported that gut feeling.
Here are the lessons that Grant has learnt building a niche brand in the ecommerce sector. Spend as little as possible to start with.
“This has been one of my number one start-up rules,” says Grant. “Don’t invest too much upfront. I’ve seen far too many entrepreneurs invest heavily in their businesses only to realise they are trying to sell a product that people don’t need. The beauty of ecommerce is that you can keep your capital outlay low. Use platforms like bidorbuy or Takealot, or even open a facebook store, any platform that already has a large customer base and will give you an idea whether your product or service is in demand. We have only ever experienced organic growth, expanding the business through our own profits. We haven’t borrowed or accepted funding.” Find a niche.
There are two ways to approach ecommerce. Either you can take the Amazon or Takealot model and be everything to everyone, or you can be a niche brand. For smaller start-ups, choosing a niche is a way to differentiate without competing against large marketplaces.
In Grant’s case, his background was in agriculture and he had struggled to find the seeds he was looking for. He saw a gap and he recognised that he had the network and experience to potentially full it. The power of a niche market is that it can be incredibly loyal if you address its needs. For example, Seeds for Africa has enjoyed between 50% and 100% year-on-year growth since launch, with the exception of 2020. The lockdown resulted in 200% growth. Much of this growth lies in repeat business. “60% of our customers are repeat business, which means we are growing our market without diversifying, simply by keeping our customers returning to us. One of the ways we do this is through a newsletter that shares helpful seasonal advice. When you educate your market, you create a loyal customer base.” Look for market trends.
It’s impossible to completely predict the future but by paying close attention to market trends, you could position your business to be a front-runner should your forecasts prove correct. When Grant launched Seeds for Africa, there was already a small movement towards home-grown wholefoods, understanding what we are eating and consumers who didn’t want to purchase foods made from genetically modified organisms (GMO).
This trend has steadily increased and wholefood farmers markets are creating a direct link between small scale non-GMO and organic farmers and consumers. Grant recognised that this was potentially where the market was heading and has organically built his business to meet those needs.
Most successful business owners will admit that a large part of business growth comes down to being in the right place at the right time. For Seeds for Africa, when the pandemic hit and people were suddenly looking for ways to grow their own veggie gardens on their balconies, Seeds for Africa was already an established brand that not only sold an enormous variety of seeds, but offered home starter kits as well – everything you needed to start your own little garden. Tap into your network.
Grant’s corporate background lay in the agro-industrial sector. He worked for companies that manufactured agricultural implements and ended up running a major retailer’s Western Cape meat division before he launched Seeds for Africa. Although he was passionate and interested in plants, his network was linked to beef farmers. What’s interesting about networks, however, and why your network is often your superpower, is that networks can become exponential. Grant knew beef farmers – but many of them knew small-scale organic farmers, and they were happy to make introductions. This was how Grant sourced the first few farmers he worked with to grow the specialised seeds he wanted to list on Seeds for Africa and his network grew from there. Stick to your market.
There are many ways to grow a business and some start-ups are tempted to diversify into disparate products to meet consumer needs. The challenge is that unless you are a very large marketplace, this can water down your value proposition. “We’ve identified our market and we believe it has massive potential to grow as people become more aware of what they are eating and how their food is produced,” says Grant.
“If we do diversify, it is always very closely linked to what we are doing. For example, we are adding hydroponic products to our business. It’s a natural extension of what we do, instead of something completely different. We’ve had a good success rate in terms of the products we select and that’s because we’ve identified our market and stuck to it. We aren’t trying to add fresh produce, for example, but we do have DIY kits that support our customers in their home garden journeys.” Go where your customers are.
Grant chose to launch an ecommerce business because it was the easiest way to market his product to an existing audience through bidorbuy. At the time, bidorbuy had 500 000 users. “It was a ready-made target market, which meant I could test if I really did have a viable idea without investing in my own online store and I could use the platform for market research purposes by tracking what people were purchasing from other sellers in my space,” he explains. “I had a good feeling for what people were looking for.” Grant listed his first products and within two days had made his first sale. Understand your product mix.
In every product catalogue (and the same is true for businesses that deliver services), roughly 20% of your offering accounts for 80% of your revenue. It’s known as the 80/20 principle. If you know which 20% it can be tempting to cut down your range, but Grant believes this would be a mistake. In fact, Seeds for Africa went from offering 50 types of seeds to 2 000 in just over a year. A decade later, the site’s product catalogue offers 3 500 seeds.
“I realised quite quickly that if we wanted to be at the top, we needed the range. Many of the seeds we sell are highly specialised and rare and often we will only sell one packet once every two or three months. That doesn’t matter. A customer may come for caper seeds or one of the 15 exotic strawberry seeds we sell, but they fill up their baskets with other products.”
In Seeds for Africa’s case, the 80/20 principle is more of a 90/10 rule – 90% of the business’s revenue comes from 10% of its product offering, but without the 90% (those rare and exotic seeds that consumers can’t find anywhere else) the site wouldn’t have as much traffic. Have a clearly defined strategy for your stock.
Stocking shoes is not quite the same as seeds, but many of the same principles apply. For fashion outlets, it is easy to overstock in certain items that are no longer fashionable the following season. Dead stock sits on shelves and eats into working capital. In Seeds for Africa’s case, calculating how much stock to hold (and grow) is a fine balance.
The strategy comes down to being able to offer rare and exotic seeds without overstocking to the point of wasting cash flow. “We contract small farmers to product seeds for us. This doesn’t require acres of land. In many cases it’s ten or 20 plants. It’s seasonal and every seed harvested has an expiry date of six months, which means it must be sold within that timeframe or we donate the seeds to charitable causes for community gardens. Once seeds are bought, we recommend that they should be planted within six months as well.”
This means that many of seed varieties are stocked in small quantities and once sold out, that seed is sold out for the season. “It’s trial and error,” says Grant. “We use historic data, and we pay attention to international trends to forecast what we need, and we mostly get it right, but not always. Occasionally a magazine article comes out about a new superfood and suddenly everyone is trying to get their hands on certain seeds. It’s very hard to predict that.”
The key lesson is that stock is a science. Use the data available to you and don’t overinvest on stock you may not be able to move – even if that means you will occasionally have an upset customer who can’t order what they are looking for. Pay attention to your distribution network.
“When we started, we used the post office to make deliveries and if a customer requested it, the post office’s speed services, which was their courier option,” says Grant. “And then a postal strike happened and we had 400 parcels stuck in the postal system.”
An online store is only as good as its ability to deliver packages, so the reliability of the delivery partners you choose is paramount.
“We replaced all 400 packages ourselves and started working with a courier service,” says Grant. “Unfortunately, our first experience was not great and so we moved to a new courier. This is an important element of an ecommerce business, so working with a reliable courier is paramount to overall service delivery.”
In fact, Seeds for Africa became one of the test cases when uAfrica
launched. “The founder of uAfrica, Andy Higgins, also launched bidorbuy and we knew each other well. We wanted to test out the new service, which brings couriers together so that you can choose who to use based on where your packages are going. Thanks to a plugin with uAfrica, our site automatically calculates shipping rates based on location and parcel rates. Working with a good logistics partner is paramount.” Find the balance between hiring and using consultants.
Like many ecommerce start-ups, Seeds for Africa was launched from Grant’s living room. Within two months he hired an assistant to help with the packaging of seeds and this soon grew to include qualified horticulturists to assist with customer service and technical queries and warehouse staff to assist with the ever-increasing number of orders coming through the website.
However, while there are some roles that require full-time employees, others can be outsourced. “Our logistics manager, warehouse employees and customer support must be in-house as these roles are core to what we do,” explains Grant. “However, there are experts in Adwords, SEO, marketing and accounting that we can outsource to without taking on full-time resources. In today’s market, highly experienced people have chosen to freelance and smaller businesses can tap into their skills – you’re getting a senior resource for a few hours a week, which is all you need.”