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How Ula helps Indonesia’s MSMEs get inventory upfront

Published on April 19, 2023


Recent data from Indonesia’s Ministry of Cooperatives and SMEs highlights the significant contribution of micro, small, and medium enterprises (MSMEs) to the nation’s economy. With over 64 million MSMEs employing over 100 million people, these businesses account for around 60% of GDP and are an essential driver of economic growth and job creation, particularly in rural areas. As such, empowering MSMEs is fundamental for Indonesia’s sustainable development.

In a recent episode of Indonesia Digital Deconstructed by AC Ventures, host Leighton Cosseboom sat down with Bukalapak President Teddy Oetomo and Nipun Mehra, Founder and CEO of Ula, a wholesale e-commerce marketplace that provides working capital and inventory sourcing for small business owners across Indonesia. 

During the discussion, Nipun shed light on the role of small businesses in Indonesia’s macroeconomy and the challenges they face. He explained how his company Ula is helping MSMEs by focusing on smaller stores, most of which are often left by large suppliers and lenders to fend for themselves in terms of inventory sourcing and working capital. 

Nipun shared several interesting insights about market trends and quirks in Indonesia’s tier-two, tier-three, and tier-four cities, where Ula primarily operates. He also explained that the company is using a unique approach to optimize its logistics costs by delivering to multiple customers in one route and using central pickup points for cash-on-delivery orders. This not only allows the company to reduce delivery costs but also helps to streamline operations.

Nipun discussed Ula’s team-building capabilities and the company’s impact-driven focus on economic inclusion. He explained how Ula determines creditworthiness by offering payment terms in exchange for upfront inventory to small business owners – starting small and expanding the service to those with great payment histories. He explained: 

“What we do is not lending. That’s not what an e-commerce company does. We just simply offer payment terms. These terms help us identify the people who are more or less on the ball with things like payment days. We can offer more inventory to businesses that are able to demonstrate a track record of responsibility.”

Ula’s unique approach to helping small business owners across Indonesia is interesting, and it is not surprising that the startup has raised over US$117.5 million from top global tech investors like Tencent, B Capital, Bezos Expeditions, AC Ventures, and others.

By focusing on the needs of smaller stores and offering flexible payment terms, Ula is helping to build a more inclusive and sustainable economy in the nation, one that benefits everyone, from large suppliers to small business owners and consumers.

Get the full episode for free on Spotify, Apple, and Google.

See also: How KoinWorks boosts financial inclusion for Indonesia’s MSMEs
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