Chari.ma, a Moroccan digital buying platform for traditional retailers, has reached a milestone of 10,000 retailers signed up to its platform. The startup, which launched in Casablanca in January 2020, is targeting around 200,000 smaller retailers in Morocco and also looking at expansion into other francophone markets.
Chari.ma connects traditional retailers with brand owners. It allows traditional retailers to access and buy from a portfolio of brands directly without going through a wholesaler, using only a mobile phone. It promises to deliver within 24 hours. It claims its *target* average order value is MAD500 ($136).
The company is backed by HnS Invest Holding, the same Moroccan conglomerate that owns blue chip distributor Dislog. Dislog launched its funding arm in September 2018 to support innovators and disruptors in Morocco, and funded Chari.ma’s seed round. Dislog has a fleet of 728 vehicles, coverage across Morocco and represents companies including P&G, Kellogg’s, Mars, Beiersdorf (Nivea), Coty, Jacobs Douwe Egberts, Duracell, British American Tobacco and Edita. Chari.ma also distributes these brands.
Chari.ma founder Ismael Belkhayat is the brother of Moncef Belkhayat, who founded HnS Invest Holding in 2005. In December 2020, Chari,ma won Orange Ventures’ Middle East and Africa Seed Seed Challenge, beating out 500 other candidates. That month Orange Ventures acquired a 2% stake for what has been reported as $200,000, valuing the platform at $10m.
Chari.ma (chari means “buyer”) operates a model that self-funds its stock requirements. Its retailers pay cash on delivery. Using its connection with Dislog, Chari.ma pays its suppliers (the FMCG companies) on 30-45 day payment terms. As such it has 15-30 days or working capital. This is similar to how high growth platforms in Egypt work.
In 2021, Chari.ma is also targetting expansion into Tunisia, Algeria, Côte d’Ivoire and Senegal. In September 2020, Dislog acquired the FHH tissue business in Morocco. At the time, Ali Tazi, the CEO of Dislog Industries (the manufacturing arm), indicated that the company would target Tunisia in 2021. We believe that expansion into Algeria is less likely for Chari.ma: although there is a large and fragmented traditional sector well-suited to a digital buying platform, there are also strong incumbent distributors and a challenging operating environment.
Moroccan companies also have a strong interest in expansion in West Africa and Morocco has long sought membership of the ECOWAS trading bloc. In October 2019, Carrefour’s partner in Morocco, Label’Vie (owned by Retail Holding) acquired CDCI, the second-largest grocery retail business in Côte d’Ivoire. Morocco considers Senegal to be its most important trading partner in Africa and Moroccan companies have investments in banking, insurance, manufacturing and several other sectors.
