Thought Behind Things · Dec 22, 2025 · 1:48:23
You can't have 32 logistics players all surviving
Daraz's Ehsan Saya on rebuilding Pakistan's e-commerce trust problem from scratch, and why 32 logistics players can't all survive.
with Ehsan Saya
14 min read
Growing up between three continents
Ehsan Saya was born in Karachi and left at four or five, when his father moved the family to Saudi Arabia during an unsettled period in the city, around 1991 or 1992. From there the family scattered further: Saya went to elementary school in Saudi Arabia and in Athens, Georgia, then high school split between Houston and Saudi Arabia again, finishing his last semester in Canada. “I have a very complicated” history, he told Muzamil Hasan. “I had never lived for more than three years in any place until university.”
Muzamil pressed him on whether that constant uprooting was a cost or a gift, framing it against his own decision to raise his children across multiple countries. Saya didn’t hedge. “I think it was one of the best things that happened to me,” he said, adding that it wasn’t easy: his Houston years overlapped with the aftermath of 9/11, and he moved through what he called two opposite ends of “conservative, conservative too” without a stable peer group. What it built, he said, was the ability to read people quickly and adapt without the luxury of holding out for familiar ground. His graduating class in Saudi Arabia, he recalled, had roughly 35 nationalities among 70 to 80 students. That exposure, layered across Houston and Canada, shaped what he now treats as a working principle: in a world swinging between globalization and localization, adaptability isn’t optional.
”Comfortable being uncomfortable”: the return to Pakistan
Saya had no plan to move to Pakistan. He was running his own startup in Canada, after a career in investment banking, when Daraz approached him. The feedback from people around him was blunt: don’t go, you’ll fail. Saya’s response became something close to a personal doctrine: “You should be comfortable being uncomfortable.” Failure, in his framing, wasn’t catastrophic. “Worst case scenario, I’ll come back,” he said. “It’s not the end of the world.”
What tipped the decision was less a business calculation than a question he put to himself directly, translated here from his own words: “If I don’t do it now, and I don’t do it, then who will, and when will it happen?” His father, whom he described as a die-hard patriot, backed the move. Saya framed Pakistan’s appeal in terms of leverage: a smaller, higher-friction market gives an individual more room to change something than a mature one does. “If your own house isn’t clean, no one else is going to clean it,” he said. “You have to do it yourself.” He described being moved to tears at Daraz’s annual seller summits, hearing directly from people whose livelihoods had shifted because of the platform. It’s the kind of impact, he argued, that’s much harder to manufacture inside a Canadian or American career.
The bearded 32-year-old managing director
Saya became Daraz’s managing director at 32, young enough that Muzamil asked directly how he handled a market where age and seniority are treated as near-synonyms. Saya’s answer opened with a joke that wasn’t entirely a joke: “Step one, I had to grow a beard, so that I would look a little bit older.”
Inside the company, age wasn’t a liability, since Daraz’s own workforce skewed young and the culture rewarded people who asked why something couldn’t be done differently. Outside the company, particularly with government counterparts, it was a different story. Saya recalled sitting in the back of a National Assembly session with Daraz’s global CFO, both of them visibly younger than everyone else in the room, working through a tax issue while, in his telling, people stared and asked who these two kids in sneakers were. He treated that friction as productive rather than discouraging: a Gen Z instinct, in his phrase, to ask “why can I not change the system?” rather than accept that commerce in Pakistan had to stay cash-based, dukaan-bound, and unreviewed. He credited Daraz’s tolerance for failure, as long as people learned quickly, as the reason a young team was willing to keep pushing into logistics, payments, and customer experience rather than treating them as fixed.
From 15,000 sellers to more than 100,000
Saya’s headline numbers trace the scale of what Daraz has built since 2018. The seller base has grown roughly sevenfold, from about 15,000 to more than 100,000, all of whom, he said, sold something in the prior three months. Daily app traffic runs between 2 and 2.5 million people on a normal day, a figure Muzamil reacted to on the spot: “That’s crazy by the way.” Saya expects that number to climb toward 6 to 7 million during Daraz’s annual 11.11 sale.
He described the growth as showing up in three places at once: sellers becoming more sophisticated about pricing, data, and even manufacturing their own goods rather than just trading them; consumers using the app to compare prices and discover products unavailable offline; and Daraz itself getting sharper about segmentation, showing a fashion buyer fashion and a discount-sensitive buyer discounts rather than treating every user identically. Underneath all three, he credited Alibaba’s ownership for advantages Daraz wouldn’t otherwise have, from underlying technology to the accumulated lessons of Alibaba’s own mistakes.
Saya was explicit that a single seller today rarely operates alone. Beyond packing and sourcing, sellers now manage keyword bidding on Daraz’s internal search, decide which campaigns to join, and read an “opportunity center” dashboard that shows Daraz’s own demand data, which products shoppers are searching for and at what price. Daraz’s obligation, as he framed it, is to convert that visibility into a sale once a seller has priced and stocked correctly, which is why personalization matters at the scale of 20 million listed products: a buyer searching for one category shouldn’t see another. It’s also why a single seller relationship has grown into something closer to an agency function, with account management layered on top of the original job of simply listing a product.
Selling from Karachi, delivering to Chichawatni
Muzamil’s specific interest was in geography: how much of Daraz’s business still concentrates in Karachi, Lahore, and Islamabad, versus the rest of the country. Three years ago, Saya said, KLI accounted for about 65% of volume. Today it’s closer to 45 to 50%. Within Punjab, he noted, the gap between top cities and smaller ones is narrower than in Sindh, where the drop-off after Karachi to a city like Hyderabad is steep.
The mechanism, in Saya’s telling, is straightforward: assortment that simply doesn’t exist locally becomes available regardless of geography, and infrastructure has to be built to match it. He pointed to Daraz’s distribution centers in Karachi and Lahore, which he described as the most advanced in South Asia outside India, capable of sorting roughly 2 million packages a day with minimal manual handling. Last year, he said, Daraz delivered to around 4,540 towns and villages. The advantage for a buyer outside a major city isn’t price alone, Saya argued, it’s access to things that simply aren’t sold nearby at any price.
Building Daraz Express because someone had to check if couriers were telling the truth
Daraz’s decision to build its own delivery network, Daraz Express, in 2018 wasn’t born from ambition to become a logistics company. It came from a narrower, more frustrating problem: third-party couriers would report a failed delivery or a return, and Daraz had no way to verify whether that was true. “If we wanted to do it properly, we had to do it ourselves,” Saya said. Today, Daraz Express handles roughly 70 to 80% of the company’s own deliveries and has expanded into last-mile delivery for other businesses, running through 90 to 100 hubs and stations nationally with 3,000 to 4,000 riders, whom Daraz calls heroes, active during peak periods.
Saya walked through the physical path a package takes: from warehouse to sort center, then to a regional hub, then to the rider, with sorting, not warehousing, as the part of the chain Daraz has invested in most heavily, since Pakistan’s cheap labor makes warehouse automation a weaker return than it would be in a high-wage market. Building a return journey from scratch was its own project. Before Daraz Express, he said, cash on delivery meant a rider effectively begging for reimbursement from his own pocket if something went wrong; today, a returned cash-on-delivery item is quality-checked at the local hub and refunded to a customer’s wallet or card the same day. He argued that the logistics backbone Daraz built has had a spillover effect on the whole market, since brand-owned websites and standalone e-commerce operators now lean on the same delivery infrastructure rather than each needing to solve it themselves.
”Innocent until proven guilty”: policing trust at scale
Trust, Saya said, isn’t a Pakistan-specific problem, but the tools to manage it have to be built locally. Daraz’s operating principle, in his words: “My principal assumption is you’re innocent until proven guilty. But then if you’re guilty, you’re not welcome to play in my playground.” A seller who ships a plastic bottle after a customer ordered a thermos faces a financial penalty, a de-listed product, and a drop in visibility across the platform; the punishment escalates with repetition, up to permanent removal. The same logic applies to buyers, since Daraz also monitors acceptance and rejection rates on the customer side to identify people who are gaming returns rather than sellers failing to deliver.
Roughly 5,000 sellers a month go through Daraz University, a training program Saya described as mandatory for anyone accumulating enough demerit points to risk suspension. Making returns easy, he argued, is a trust mechanism in itself: a 14-day return window, doorstep pickup by a Daraz rider in the 15 cities where that’s available, and same-day refunds once quality control clears a returned item locally rather than at a central warehouse. For less dense markets, Daraz runs a “logistics marketplace” model, letting a local operator in a smaller city run deliveries under Daraz’s technology and training standards, almost as a franchise, while also serving other companies’ packages in the same territory.
Why Daraz opened its delivery network to 32 competitors
Pakistan now has roughly 32 companies competing in last-mile logistics, a number Saya and Muzamil both treated as unsustainable. Muzamil pushed the comparison directly: in the US, thin retail margins can absorb the cost of returns and free replacements; in Pakistan, a 10-rupee item is barely selling for 10.5 rupees, leaving no room to absorb failure. Saya agreed with the underlying thesis. “It’s not only a razor-thin margin business, it’s a very thankless job,” he said, since almost no customer publicly praises fast delivery, but plenty complain when it’s slow.
His argument for consolidation rests on the difference between fixed and variable cost. Daraz has already paid for its sort centers and rider network; every additional volume it carries for outside clients only adds variable expense, which keeps falling as density rises, while a newer competitor still has to raise capital for the fixed infrastructure Daraz already owns. That’s the logic behind opening Daraz Express to businesses that don’t sell on Daraz at all, launched publicly in the days before this conversation. Saya framed it plainly: “I don’t need to do it. My cost per package will be lower than if I don’t.” The same efficiency argument, he said, extends into payments: about 80% of Daraz orders are still cash on delivery, with only 20% of order volume on cards or wallets, and Daraz has begun testing “digital on delivery,” a push notification sent an hour before a rider’s arrival that lets a cash-on-delivery customer switch to a card or wallet payment before or at the doorstep. He credited the Raast payment rail with removing transaction fees that previously made digital payments more expensive than cash for thin-margin sellers.
11.11: an economy-wide ritual Daraz built from scratch
Pakistan’s biggest annual shopping event, the November 11 sale, is a Daraz invention that other platforms have since copied. Saya said Daraz typically targets 10 to 20 times its normal daily volume on the day itself, a scale he called an operational nightmare, but one that only works because it has become a whole-ecosystem event: brands time product launches around it, banks compete on discount financing, and offline retailers now run their own 11.11 promotions in parallel. When Daraz first ran the sale, November wasn’t traditionally a buying month in Pakistan. It is now. Saya described spending the weeks beforehand personally negotiating SKU-level pricing with brands, adding that he hadn’t had a full night’s sleep in the two and a half months before the event.
The sale matters beyond Daraz’s own balance sheet, in his telling, because every side of the ecosystem plans around it. Sellers wait an entire year for the volume spike; consumers hold off big purchases, appliances, wedding-season fashion, knowing prices will bottom out. Asked what the day means to the riders who carry the load, Saya recounted asking one directly during a hub visit. The rider’s answer, translated: “11.11 is Eid for us. There are so many packages, it’s a chance to actually make money.” Saya also noted that consumer spending carries its own seasonality independent of 11.11, tracking wedding season, Eid, and summer appliance demand, and that Pakistan’s 2022-era economic downturn visibly showed up in the data: brands shrank pack sizes and product tiers, such as a smaller-capacity air conditioner replacing the standard one-ton unit, so that a fixed household budget could still afford a version of the same category. He said that pattern has begun to reverse as spending picks back up, with Punjab currently showing more of that recovery than Sindh.
Managed marketplaces, exports, and betting on AI to leapfrog
Asked about the rise of curated and managed marketplaces in fashion and electronics, categories he named specifically as areas where niche players have emerged, Saya said Daraz’s response has been to treat every category as bought differently, building category-specific expertise rather than assuming a single storefront logic covers groceries, mobile phones, and fashion equally. He was clear that Daraz won’t productize its underlying technology, since it was largely adapted from Alibaba rather than built in-house, but logistics is a different story: that’s the expertise Daraz considers genuinely its own. He was equally direct about private label, saying Daraz had tried its own house-brand products before and hadn’t done it particularly well, and had decided to stay focused on the marketplace and logistics roles it’s actually good at rather than move into manufacturing and design. On exports, he said Daraz sees an opportunity in categories like modest fashion and textiles, where Pakistan has a cost advantage over China or Vietnam, but called it “a bit of a distraction” for now. “We really need to crack Pakistan,” he said, “and then, inshallah, we’re going to go into other countries too,” putting a realistic timeline of 18 to 24 months before that becomes a priority.
On AI, Saya described Daraz already training models to place fashion products on AI-generated Pakistani models rather than requiring sellers to shoot their own photography, and an AI support bot that resolves basic seller questions before a human needs to step in. He framed the bigger opportunity around the roughly 98% of Pakistani sellers whose business is still offline and who don’t know how to write an English product title or optimize a listing. AI, in his view, closes that gap directly. He tied this back to national strategy: Pakistan, he argued, cannot catch up to other economies on a straight line and needs AI to produce what he called a step-function jump rather than slow, linear progress, comparing it to how countries that invested in manufacturing decades ago leapfrogged others.
Closing on Pakistan’s outlook to 2050, Saya rejected the premise that optimism required ignoring the country’s problems. “If you become hopeless, there is no way that you’re going to solve the problems,” he said. “You have to maintain hopefulness.” He pointed to Pakistan’s young, large population, north of 225 million people, and what he called globally competitive talent as reasons for confidence, arguing that the choice to focus on what’s fixable, rather than cataloguing what’s broken, is itself a discipline worth practicing deliberately. As digital payments spread and seller maturity compounds, he expects e-commerce penetration in Pakistan to keep climbing, not because any single policy forces it, but because a seller now earning half their revenue online has every incentive to protect that channel by getting customer experience right.
Full transcript
Assalam-o-Alaikum khawateen-o-hazrat, welcome back to another episode of Thought Behind Things. Jaisa ke aapko pata hai aaj kal meri series chal rahi hai with Endeavor Pakistan, where we're trying to look for Pakistan's 50 most exciting startups/businesses. Aur isme I feel like agar is tarah ki list Pakistan mein banayi ja rahi ho, to it cannot possibly be completed without speaking to possibly Pakistan's one of the biggest, if not the biggest, startup. I don't know, isko ab startup bhi bolenge, ab to it's a huge business. They've recently, you know, launched a new service as well, so they're expanding into last-mile delivery space as well. But Daraz Pakistan, jo ke, you know, it's a, in many ways, it's the OG startup of Pakistan. Ek aisi cheez jo ke Pakistan se shuru hui aur ab, I believe, paanch countries ke andar exist karti hai with the same name. There's a lot of pride attached to this company as well. There are a lot of questions attached to it as well because, in many ways, they are the primary... E-commerce jo hai na, wo hamesha digital revolution mein pehli cheez hoti hai aur poori duniya ke andar e-commerce ke platforms jo aaye, usne aake bahut zyada behavior bhi change kiya, usne bahut zyada lifestyle bhi change kiya. To uske upar bahut zyada log question ye baat karte hain ke kya Daraz ki wo pace rahi hai jo ke hum expect kar rahe the? Kya wo usse aage nikal gaya hai? Kya actual outcome raha hai for something like Daraz, which again is currently, if... and they can verify this as well, they're the largest e-commerce platform in Pakistan. Aaj hamare sath maujood hain Daraz ke CEO Ehsan Saya. But before I get into that conversation, quickly I wanted to mention, Endeavor Pakistan is a phenomenal community jo ke poori duniya ke different entrepreneurs ko, founders ko connect karti hai. If you want to know more about them, the link is down in the description. Sath hi, I would love if you guys, kyunki 80% log aate hain, sunte hain aur nikal jaate hain, subscribe nahi karte, to if you can subscribe to the channel. I hate asking for this, but YouTube works like this, so, you know, mujhe recommend kiya jata hai team ki taraf se bhi aur YouTube ki taraf se bhi ke baraye meharbani logon se kaha karein. To subscribe zaroor kar dijiyega, and if you like the video, please do like the like actual as well because it helps the algorithm. But anyways, this is Thought Behind Things, Season 5, Karachi Studio. Assalam-o-Alaikum Ehsan, thank you so much for taking the time out and joining us.
Walaikum Assalam. Thank you so much for having me here today.
It's been a while, do teen saal se hum mulaqat kar rahe the, trying to set this up. I'm glad that you're finally here. I want to just sort of start off, before I talk about Daraz, of about everything that you guys are doing, I want to understand a bit more about you. Where were you born? Early life aapne kahan pe guzari? And what were some of the themes growing up that you feel like made you the sort of person that you are today?
Yeah, I think so, I was born in Karachi. Phir jab main takreeban char-paanch saal ka tha when we moved. I grew up mostly between Saudi Arabia, US, and Canada. Um, I think for me, when I really dissect my, my, my life, I would say some of the, some of the foundations had a lot to do with, with the principles obviously that my, that my parents taught me. My father was, in fact, both my parents are very principled people. But, you know, I think a lot of what I carry today, in fact, abhi bhi koi agar Daraz mein bhi koi masle hote hain, then I'm, one of the first people I speak to is my father, for advice. And, and, you know, the way we've built the company, jis tareeqe se humne values, I think, Daraz mein bhi daali hain, of integrity, of, of doing the right thing, customer experience, customer service, ye saari cheezein, I think, wo it was a build-up of things in my life that, that have, Alhamdullilah, led up to, to this.
Interesting. What led you to move out of Pakistan for all those years?
Haan, to I, I was, I mean, I was four-five, but I think family us time pe isliye move hui thi because Karachi ki situation, you know, wasn't so great. I think this was 91-92. Um, to us waqt mere father decided ke yaar let's move out of Pakistan. To wo Saudi, wo Saudi Arabia gaye. Phir uske baad, you know, soon after we followed, we followed him there as well. There's three of us siblings, um, and so, you know, all of us moved to Saudi for, for a while, and then my brother moved to, to Canada shortly after.
And Canada, I mean, you, you essentially all of your primary and, and high, high school education, wo saari Saudi ki thi?
I have a very complicated... So, I had never lived for more than three years in any place until university. So, I moved around a lot. Magar zyada tar I would say ke, you know, elementary school Saudi mein thi. Khair, usme Athens mein bhi thi, Athens, Georgia. Aur phir uske baad maine high school ki Houston, Texas se, and Saudi Arabia. Phir main, in fact, last semester of high school mein Canada mein tha. To I've moved around a lot. So, abhi bhi agar aap, you know, if you find me in an elevator, I, by the third floor, I'll, I'll have made a friend in the elevator because I, that's what I've always had to do.
Acha, ye badi interesting hai because I was actually discussing with my wife the other day ke yaar, you know, I have a four-year-old and I have a almost one-year-old daughter. Um, aur main discuss hi kar raha tha ke yaar meri lifestyle aisa hai, main digital-first banda hoon, ke insaan jo hai na har do-teen saal baad move kar le, kabhi Malaysia chala jaye, kabhi Turkey chala jaye. Um, and she basically countered that ke yaar bachon, bache to pagal ho jayenge. Wo to, you know, aapne ek wo base banayi, school mein gaye, friends banaye, phir aap unko uproot karenge, unko ek nayi jagah pe utha ke le jayenge. Um, and so I'm curious, as someone on the receiving end of that, how, how, I mean, did you hate it? Did you be like ke yaar what was wrong with my parents, why couldn't you let me have long-term relationships? Or do you think at the time, as well as in hindsight, you do appreciate the exposure that you got? Because my thought is the exposure value, right? In today's day and age, if you can go to so many cultures and you have the opportunity, why not? But I'd love to know your opinion on that.
Yeah. So, I don't want to partake in the, the argument between your wife and you. But I'm, I'll tell you, I'll tell you because I've thought about this a lot. And I think it was one of the best things that happened to me, Alhamdullilah. It doesn't mean ke usme har cheez aasan thi. Aasan nahi tha, right? I mean, agar main high school dekhoon to 9th and 10th grade I was in Houston, 11th and half of 12th mein Saudi mein tha, aur phir main Houston gaya. Right? Matlab ye ke, if you think of conservative, two opposite spectrums of conservative, conservative too. Right? To, and, and this was sort of, when I was in Houston, it was sort of around the time of, of 9/11. Right? To it wasn't easy. Matlab mujhe yaad hai ke mere, I think mere do prom hue the. But at the same time, it really taught me a lot about different cultures, right? And also how to acclimate. And I think it's very important, like if I look at one of the, Alhamdullilah, the qualities Allah has given me, I think one of the qualities is that I can, I can, I can get to know people at a deeper level very quickly. Because like I said, all my life I had to. So, I think it's not easy necessarily, magar iske fayde bahut hain. I think in, in today's day and age where we're going from globalization to localization, and maybe perhaps in years we go from localization to globalization, you need to be very adaptable. And I think when you move, it forces you to become adaptable because it's the only way. You don't have, you don't have the luxury of, you know, ke yaar main, matlab main dost nahi banaunga, ya main ye nahi karunga. You're just like, 'Yaar, theek hai, ab ye hai, now we move forward.' To I think isme bachon ke liye, theek hai, us time pe I think it has its challenges, no, no doubt, it's not like it was always easy. But, Alhamdullilah, now when I look back at it, I think it made me a lot of who I am actually, in that, in, in the way I behave and the way I also am exposed to a lot of different cultures. Matlab meri, I guess, jo meri school thi Saudi mein, I think maybe graduating class mein bhi 70-80 bache honge aur usme se I think there was like 35 nationalities. Right? And then going to Houston, and then going to Canada, like all of these places, aapko jo exposure milta hai, um, usse you start also very early knowing ke yaar aapki priorities kya hain, aapko kis, kis kism ki life chahiye, um, and you start, your personality starts shaping. And I think, Alhamdullilah, for me, positively. Um, yeah. So, I am, I guess, your wife might not like this podcast.
Yeah, I'll send her a clip. Mujhe ye batayein ke, you mentioned, you know, values that your parents inculcated in you. I, I feel like, and again, another area that I think deeply about, a lot of these developed societies, more often than not, wahan par wo, wo chalti is wajah se bhi hain because they're high-trust societies. And so, aap, you know, they're able to create higher value just because people trust each other and you don't have to necessarily go through a lot of the developing, emerging markets ke masle hote hain ke, you know, everybody is trying to snatch the pie from the other person rather than working together to increase it. Um, you left at four, and I'm not sure how much of that traveling included you coming back to Pakistan and spending like a substantial amount of time here to be able to absorb really what, what, what's going on there. Um, but Saudi, again, I, I spent a couple of years in, in Dubai. I was born in Saudi as well, so family ki jo, um, 17-18 saal jo parents wahan pe rahe, to I've heard a lot about ke, you know, it's a, it's a beautiful society, bahut zyada, um, safe society hai. Dubai was very similar as well. Um, West mein bhi aap jaate hain to in many ways, in particularly during the time that you were there, to it's very collaborative and it's very different. Um, and so one would assume ke someone like that, and again, while we were in Dubai, to main ye bahut sochta tha ke yaar main bacche ko yahan pe rakkha hua hai, kitni safe jagah hai, zabardast hai. Phir mujhe khayal aata tha, main sochta tha yaar main isko stunt to nahi kar raha ke isko pata hi nahi hai ke real-world environment mein, jisme hum bade hue hain aur hum usme street-smart hue hain aur usme humne maneuver through karna seekha hai, um, the lack of all of those things usse kahin na kahin aise to nahi hai ke wo aage ja ke sustain hi na kar paye agar usko karna pade, right? Aapne ye saara time guzara, and then 2018 is when you essentially came back, came back to Pakistan full-time. Um, and you've been there for the last almost eight years now. How has that transition been? Like, from the, from the side, I'm curious what your, what your, if, if you were married at the time, what your wife or your friends or peers thought ke yaar why are you going to Pakistan, what's, you know, what's going on there? Um, and then khud bhi bande ko khayal aata hai ke yaar acha, are you sure? Do I want to go there? 2018 was also us waqt bhi ek economic crisis bhi up and down ho raha tha. Um, to tell me about that transition of re-entering Pakistan in a very different way now that you're, you're grown up and, um, and fairly successful, well-settled in many ways.
Alhamdullilah. Look, I think, um, jab, you know, mera koi plan nahi tha Pakistan move hone ka. And, uh, you know, when I was approached by Daraz, it was sort of the first time I, I thought about it. Um, and at that time I was running my own, own startup in Canada. And I think the, you know, of course feedback sabka ye tha ke yaar Pakistan na jao. You're going to fail in Pakistan. And actually that's sort of what, like my life mantra has been, you should be comfortable being uncomfortable. To was like ke Pakistan will definitely make me uncomfortable. And so what if you fail? Matlab, uh, theek hai, worst-case scenario wapas aa jana. It's not the end of the world. Aaj kal matlab ye nahi hai ke, you know, to, you can take a flight back, your parents are there, everything is there, to aap wapas aa sakte hain. To I think isme ek ye tha ke yaar agar main abhi nahi karunga aur main nahi karunga to kaun karega aur kab karunga? Aur ye I think ek bahut ek isme mere andar ek I think jazba aa gaya tha. My dad, my dad is also a die-hard patriot, so when I said yaar mujhe karna hai. And I think, I'll tell you what sort of my framework was. Ek to ye tha ke yaar, you know, Alhamdullilah, I had a successful career in investment banking, phir ek, you know, I had a, I had a startup which struggled a bit. Aur phir uske baad I was like yaar mujhe kuch life mein aisa karna hai that I can have an impact. Main kuch change la sakoon. And I think Pakistan gives you that better than anywhere else. Ke aapko agar change laana hai na, aap apne neighborhood mein change layenge, it's bigger than some countries. To it was one of those ke yaar agar main abhi nahi karunga to ye mauqa kabhi aayega ya nahi aayega. Aur theek hai, agar maine kiya and nahi chala, to so what? Isme, will I learn or will I not learn? And so that was I think a very important deciding factor ke yaar ab mujhe, it didn't matter so much ke log bol rahe hain ke you'll, you'll fail. I was like yaar theek hai, you'll, I'll fail again, one more time. It's okay. And, uh, you know, agar as long as you fail and you learn, then it's not a failure. To worst-case scenario, theek hai, I'll have a, you know, I'll live a few years in Pakistan. If it doesn't go well, I'll, I'll come back or I'll go somewhere else and I'll learn. Um, and Alhamdullilah, since I've come here, I've only been inspired. Yes, there's problems. It's, it's not like ke problems nahi hain, there's lots of problems. Matlab aapki regular normal day-to-day life mein bahut sare masle aate hain. Magar I think aapko ek choice bhi banani padti hai ke yaar main ya to ek road pe agar ja raha hoon, am I going to look at the flowers or am I going to look at the gutter? And it has to be a very deliberate and conscious decision. Um, and it doesn't mean ke aap road na dekhein, magar aapko thoda apna look, apna view bhi hai wo thoda positive rakhna padta hai ke you look towards the flower, you look towards the things that are going well. You know, um, Pakistan has a treme- like tremendous talent, tremendous. Honestly, maine, I did investment banking for seven years and I would say, Alhamdullilah, jo talent hamare paas na to sirf Daraz mein, magar bahut saari companies jo Pakistan mein hain, it's toe-to-toe with some of the best people I've ever worked with. And, and, you know, you see that in so many organizations in the world, they want Pakistani talent. I can say this for Daraz as well ke agar, you know, koi Singapore mein koi chhodta hai to first priority hai ke yaar Pakistan mein banda dhoondte hain hum. You know, because they're very good, uh, there's very good talent here. To I think, um, Alhamdullilah, I've been very fortunate, very lucky. I've made good friends here. I, you know, and, and, Alhamdullilah, do something that I absolutely love. And, and, more than all of that is, Alhamdullilah, I do something that I can have an impact, you know, ke hamare paas Daraz pe we have more than 100,000 sellers on our platform. Um, you know, and I've met sellers, hamara ek har saal seller summit hota hai, ek Lahore mein hota hai, Karachi mein hota hai. And almost, honestly, every year I do it, I, I'm almost left in tears. And because you meet people and you hear from them the, the impact that what you're work had on their life. And aapko phir ehsaas hota hai ke yaar main kyun kar raha hoon. Aur, you know, even for a lot of people that are at Daraz, main unko ye samjhata hoon ke yaar ye kyun kar rahe hain. Aap kaam to aapko kahin bhi mil sakta hai, magar aapko ye jo impact hai, aap wo kahin nahi la, aap wo kahin bahar nahi la sakte. Ab US mein, Canada mein, Europe mein aapko wo impact laana aapke liye mushkil hoga. Aur agar aapka, aapka ghar aap khud saaf nahi karenge to koi aur nahi saaf karega, aapko khud karna padega. To agar aapko hai ke yaar ye mulk behtar ho, to aapko karna hai. Ye nahi hai ke koi aake aapko, you know, they'll, everything will be perfect and then you just say, 'Yaar, perfect, great.' Like, you have to do it. You have to do your part.
You were one of the youngest Managing Director, um, jo ke Pakistan mein ek, ek series, serious corporate ya ek serious company ke andar appoint hua. My understanding is you were early 30s when you joined.
Yeah, I was 32.
Yeah, so at the time, Pakistan ke andar ek cheez maine ye bhi dekhi hai ke people tend to not take you very seriously when you look too young. Um, and so I'm curious ke when, when you became the MD, what, how was that? I'm, I'm sure a lot of people that were working for you, possibly, were potentially older than you. Um, a lot of the partners, agencies, this, that, would have been older than you, would have had, uh, a far greater experience. Um, and so this context is not necessarily driven by Daraz, but driven by maybe someone is working somewhere and apne career mein, apne usme na there's a lot of politics in Pakistan, there's a lot of bureaucracy. And wo is tarah ki cheezon pe hoti hai ke, you know, like logon ko apni, uh, uh, space ka ya apne uska ego ho raha hota hai ke yaar ye kal ka baccha aake humein kyun kar lega. Khaas kar jo Gen Z generation hai, unka to ye hai ke, you know, they really want to go in and break stuff. Um, and so I'd love to know how you maneuvered through that and how challenging was it to, to, to solve? Kyunki ye aaj kehna bahut aasan hai ke obviously e-commerce hai, yun karenge, woh karenge, grow ho jayega. Aath saal pehle ki agar hum baat karein to us time ke upar to everybody was like ke ye sab time zaya kar rahe hain, actual mein to aise hi hai. You know, there was, you, you come from a Memon family, there was very particular sethia style ke yaar humein pata hai humne 100 saal kiya hai, ye tum kal ke bacche na batao humein aake, right? Ke ye nayi technology kya kar legi. Um, so how was that in the start?
Yaar, look, step one, I had to grow a beard, um, so that I would, I would look a little bit older. Um, magar dekhein, I think isme ek to fayda ye tha ke Daraz pe the population, the, the talent we had was very young. Aur hamara jo mindset tha wo ye tha ke yaar actually let's bring bache and give them an insane problem and empower them to solve it. To I think, uh, you know, even at 32 I was definitely one of the older, older ones. Right? So, from a work perspective, uh, you know, I think it was, Alhamdullilah, you know, very manageable. Hamare paas jo talent tha, it was like I said, it was, it was younger, very hungry. Um, aur us age pe aap sab ek sath mein ghus ke problems solve kar sakte hain. You can really get everyone into one place and say ke agar ye masla hai to humein kaise step-by-step solve karna hai. Obviously aapko ye jo challenge zyada aata hai wo, you know, even partners se zyada government mein aata hai. Isliye wo aapko dekhte hain aur bolte hain ye baccha kaun hai? Haan. Kahan se aa gaya ye baccha? You know, I, I remember hum log ek dafa National Assembly mein baithe hue the aur us waqt hamari jo global CFO thin aur main, hamara ek tax ka issue ho raha tha us waqt bhi. To, you know, we were just sitting in the back, two kids, um, just trying to understand, you know, we somehow just got ourselves in. Humein ye bhi nahi pata hum kaise andar ghus gaye the. To, you know, aur sab dekh rahe hain ke yaar ye do bacche sneakers pehan ke aa gaye hain. Kaun hai ye? Kya, apne aap ko kya samajhte hain? To I think isme, this was a little bit also, for like you said for Gen Z, was a little bit empowering ke main kyun nahi kar sakta hoon? Matlab why can I not change the system? Why can I not, like ye kyun hai ke har cheez sirf dukaan mein, offline ya tax ke bagair ya, you know, cash pe bikni chahiye? Ke hum kyun behtar, hum isko behtar kyun nahi bana sakte? Hum logistics ko behtar kyun nahi bana sakte? Hum payments ko behtar kyun nahi bana sakte? Hum, hum customer experience ko kyun behtar nahi bana sakte? Hum ye cheezein, aur log bolte the yaar Pakistan mein log reviews nahi chhodenge, ye nahi karenge, wo nahi karenge. Kyun nahi karenge bhai? Poori duniya karti hai, hum kya koi, like are we not humans? Matlab aapko bhi kuch khareedte hain to you want to know ke yaar ye cheez achi hai ya nahi hai. Aap chahte, aap agar dukaan se ja ke poochenge, ab dukaandar se poochenge wo bolega, 'Bhai, ye to best hai.' Jaise ke...
khane jate hain to bolte hain yaar kya ek mashwara de na kya lena chahiye. Sab acha hai. Wohi hai na ke har cheez sab acha hai. Magar to online aapke paas ye ek opportunity hoti hai. And and I think our you know Pakistan is like any other population will adopt a lot of those things. Maybe you know koi cheezein hain jo jis pace pe hum chahte the ke hon wo nahi hui us pace pe. Magar iska matlab ye nahi hai ke na nahi hongi. Wo hongi. It's just a matter of when. And then, you know, this is uh you know, companies like Daraz, what's powerful about them is that they democratized these industries. You know, you you democratize e-commerce, or commerce actually. You don't need to have ke aap meri ek sadar mein ek dukan hai jiski main jiska main rent de raha hoon 4 lakh rupaye aur phir mujhe har mahine koi na koi naya masla hai. Main apne ghar se shuru kar sakta hoon. Humm. Hamare aise bahut saare sellers hain jo actually shuru hue the traders se. Um aur phir you know, time ke saath-saath humne bola yaar price kam karo, quality behtar do. Price kam karo, quality behtar do. To eventually us bande ne bola ke yaar mujhe main trading sirf nahi kar sakta. Ye nahi ho sakta ke order aaye phir main ja ke bazaar se dhoondhoon phir main bechoon. Isliye usme mera main aap jo price maang rahe ho usme main kar hi nahi sakta ye kaam. To usne kaha ke yaar main khud banana shuru karta hoon. Main khud manufacturing shuru karta hoon. To ab ab main bahut saare sellers se milta hoon jo evolve hue hain jo traders se gaye hain manufacturing ki taraf. Um and that's a very good positive change. You know? To um I think wo obviously I think when you're when you are a bachcha, you sort of you're like yaar ye kyun nahi ho sakta hai? Hum kyun nahi kar sakte? Ye ye like it's almost like possibilities are endless. And then you're working with a lot of other bachchas, right? Ke sab soch rahe hain ke yaar hum kyun nahi kar sakte? Ke I mean aap sochein ke agar 21-22 saal ke aap hain, aap graduate kar rahe hain aur aapko ek jagah mil rahi hai jahan we're saying yaar ye bahut ek bada masla hai aur hume hum kisi ko hume pata nahi hai ke kaise solve karna hai. Magar hum ghus ke sab saath mein solve karenge aur hum aapko bol rahe hain yaar no problem if you make a mistake. As long as you learn from it and iterate quickly. To that's very empowering. Matlab main jab 21 saal ka tha to mujhe you know even though I was doing investment banking wo freedom nahi thi. So I think wo ek you know being at a company jahan aap ek uh aap apne aap ko challenge kar sakte hain aur aapko you know ye guidelines di hoti hain ke yaar ye masla hai. There's we don't the right answer is not just ABC. Agar hota to main aapko bata deta ke ye karo. I think that's very it's it's very fun. To matlab alhamdulillah I think I can say that we have a lot of fun at work. Like alhamdulillah I haven't had days where I haven't felt like going to the office and I think most people because we're doing things that are we're punching above our weight, actually all of us I think. And alhamdulillah Daraz gave many of us an opportunity to punch above our weight. Ke hume jo cheezein try karni thi wo hum kar sakte hain because of Daraz.
Tell me about the evolution of the last eight years since you've been there. So where was Daraz at the time and aaj kahan pe khada hua hai and if you can give me some context of the scale uh that you're operating on?
Yeah. Yeah, I think us waqt hamare I think takriban 15,000 sellers the 7-8 saal pehle. Aaj mashallah hamare 1 lakh se zyada sellers hain across the country.
Ye 1 lakh active sellers hain? Matlab ye mahine mein kuch na kuch.
Ji ji ji. Ye pichle teen teen pichle teen mahine mein 100,000 sellers kuch na kuch bech rahe hain. Right. Um so this number, you know, over time has has not only grown significantly. Magar iske saath-saath jo customers hain hamare paas takriban aap sochein ke har din 20 se 25 lakh log hamare app pe aa rahe hain.
That's crazy by the way.
Yeah, yeah, it is crazy. 20 se 25 lakh log har roz aa rahe hain. Ye nahi hai ke saare khareed rahe hain. Haan. Magar jaise mujhe yaad hai us din maine mujhe main apne ghar pe ice bath bana raha tha. Mujhe shauk hai pata nahi thande paani mein baithne ka. To maine apne kisi ko ghar se bheja tha ke yaar ye ek mujhe pump chahiye. To usne mujhe udhar se phone kiya aur bola ye 1000 rupaye ka mil raha hai. To maine kaha mujhe tasveer bhejo. Maine wohi tasveer Daraz mein upload ki aur wo cheez 250 rupaye ki thi. To maine us bande ko wapas maine usse phone pe baat ki maine kaha ye Daraz se mujhe 250 ka mil raha hai. Tum theek hai 300 le lo mujhe abhi chahiye foran aa jayega mere paas. Magar 1000 rupaye aur 250 rupaye kahan? Usne kaha sahab main 250 mein nahi kar sakta. Main nahi kar sakta. Jo banda kar raha hai wo ho sakta hai bahut quantity le raha ho wo 250 rupaye mein kar raha hai. To I think ye evolution consumers ke saath bhi hua hai ke obviously ye jo 20-25 lakh log in fact jo abhi 11-11 aa raha hai, our expectation is takriban 60-60 lakh log hamare app pe aayenge us din, 60-70 lakh log. That's a lot of people that are, you know, that are coming with the intention of buying and when people say ke e-commerce kya hai, to yaar log ke paas app hai, wo consider kar rahe hain, wo dekhte hain ke yaar product ki reviews kya hain, pricing kya hai, wo apne aap ko you know they discover new hobbies, they discover new categories jo you know probably potentially jo products Pakistan mein jo aasani se nahi milte hain, wo aapko aap wo Daraz pe discover kar sakte hain. Hamare paas we have more than 20 million products on our on our app. Right? So it gives you an ability to really discover and buy new things that and and even if you don't buy to be able to say ke yaar ye cheez ki pricing kaisi hai. How does it compare to, you know, jo main abhi apne koi bazaar se jo khareed raha hoon. To I think ye evolution alag-alag tareekon se aaya hai. Ek to ye hai ke sellers ki taraf se there's much more maturity. Mujhe yaad hai ke jab main pehle move hua tha to mere paas ek notebook hoti thi apne saath. Jab bhi gym bhi jata tha, koi bolta tha yaar maine falana cheez Daraz se mangwai wo sahi cheez nahi aayi aur return mein ye masla hai. Aur main har cheez mein likhta tha notebook mein aur phir main ja ke hum log solve karte the ek-ek karke. Aaj alhamdulillah, you know, our customer experience is significantly better. Hamare returns I think takriban 1-1.5% hain. Uh magar wo sellers ki maturity ke saath bhi aata hai. Sellers ko samajh aata hai ke yaar main agar ek cheez bolunga aur maine kuch aur bheja to mujhe financial penalties bhi lagengi, mujhe return ke paise bhi lagengi aur meri meri jo cheez hai wo aage wapas bikegi nahi. To ab ulta seller bolta hai usme note likhta hai ke yaar please give me five star review maine aapke liye achi service di hai aapko follow up karta hai. Of course that's not every seller. Magar sellers mein bhi maturity time ke saath-saath aati hai. Brands mein bhi you know ye ek maturity saath-saath aati hai. To sellers ki taraf se ek maturity aayi hai ke wo ab samajhte hain ke yaar online mujhe kaise bechna hai. Data kaise mujhe read karna hai. In fact just recently maine ek session kiya tha hamare fashion sellers ke saath. Aur ek seller mujhe jo cheezein hamari data aur app ke bare mein samjha raha tha mujhe bhi nahi pata tha. And they're very intelligent. They're very intelligent unko pata hota hai ke yaar agar ek cheez itne itni price pe bikegi aur aap mujhse ye maang rahe hain to main ye nahi dunga main ye dunga meri phir bhi bik jayegi. Aur main and I was actually blown away that it was you know ye dekhein karobari log hain. Inko pata hai kaise bechna hai. Magar inko bas ek ek avenue de rahe hain ke yaar ab aap Karachi mein agar aapka dukan hai to aap aapki aap aapka item Chichawatni bhi ja sakta hai. You know koi restriction nahi hai ke yaar jo paros mein ya kareeb mein jo shehar mein hai wo aa ke khareedenge. It's open for for everybody. So that's on the seller side. On the consumer side, um like I said us waqt pe to obviously hamare I think maybe din mein 5 lakh log aate honge. I don't even know agar 5 lakh. I don't remember at that time. I think even less than 5 lakh log. Obviously beech mein jab humne wo cricket streaming ki thi to usse we had a huge spike in you know people knowing about the app. Um phir uske saath-saath we showed them ke yaar you know hamare paas ye assortment hai, pricing strong hai, brands itne saare hain. In fact pichle takriban 60 din mein humne 150 brands on board kiye hain Daraz pe in gearing up for for 11-11 and you know ye saari jo cheezein ye karte hain hum isliye karte hain ke logon ke paas ek ek reason ho to come back to Daraz, you know. So there's a lot of loyalty programs on Daraz now. In fact humne ek do teen hafte pehle ek cheez launch ki thi it's called Daraz Freebie. Ke aap ja ke kisi ko invite kar sakte hain. Main aapko ek link bhej sakta hoon agar aap Daraz install karenge to mujhe do teen log agar kuch install karenge to mujhe ek cheez free milegi. Agar main 50 log karte hain to mujhe kuch aur kuch aur free mein mil sakta hai. And we're a very data driven organization. So we look at yaar iski efficiency kya hai versus online marketing ki efficiency kya hai versus offline ki kya efficiency hai. To you know it's uh isme there's been an evolution on seller side and consumer side and then I would say finally on Daraz's side, on our own side. Jis tareeke se hum data dekhte hain, jis tareeke se hum samajhte hain consumer chah kya raha hai, uski segmentation. Ab you know agar agar koi consumer hai jisko 50 rupaye ka discount hai main 1000 usko kyun doon? Aur jisko 1000 ki zarurat hai main use 50 de ke kya karunga? Jisko fashion chahiye main usko kuch aur bech ke kya karunga? Us ko mujhe fashion dikhana hai. Us ko jo cheezein uske liye relevant hain mujhe wo dikhani hain. To usme hamari bhi ab bahut evolution hui hai. Isme obviously ek bahut bada fayda hamara ye hai ke our parent company is is Alibaba. You know us uski wajah se hume bahut advantages milte hain. You know even a lot of things that we didn't know how to do. Jis tareeke se humne 11-11 pehli dafa launch kiya and versus what it is today, it's a very different way that we that we do it, the way we plan, the way we organize. Um so I would say those are the three main buckets of our of our of our evolution.
That makes sense. You've said a bunch of things here and I'd be curious to know more about it. Ek aapne mujhe kaha ke main Karachi se baith ke Chichawatni mein bech sakta hoon, right? So I'm curious ke jo is waqt, I don't know if you have the analytics for that, but um is waqt Daraz ka jo buyer hai, wo KLI versus non-KLI mein kitna hai? Because then that's something that I ask everyone, price oye, this that, jitni bhi maine abhi tak platforms se baat ki hai. Because mere hisaab se jo sabse badi potential problem to solve aur jo sabse bada potential change aap lekar aa sakte hain wo ye lekar aa sakte hain ke yaar KLI ki duniya se nikal ke aap GT Road ke left right ko empower kar rahe ho, aap pure Pakistan ko, kyunki wahan par leapfrog hai na? Wahan par aap infrastructure ka wait nahi kar rahe, aap malls nahi bana rahe, aap bahut saari aur cheezein nahi kar rahe. Wahan pe aap us consumer ko wohi access de rahe hain um jo ke kisi bade shehar ka access hai and usme aap efficiency lekar aa rahe hain jahan par shayad uski kareebi dukan tak pahunchne ke liye darmiyan mein char haath badal ke premium add hota rahega. To wo sara premium aap avoid karke directly us tak pahunch rahe ho.
So agar main dekhoon ke teen saal pehle takriban 65% was you know Karachi, Lahore and Islamabad. Aur agar aaj dekhein to that's about 50, 45 to 50% that's now happening in Karachi, Lahore, Islamabad. And if you actually look at it, agar aap dekhenge Punjab aur Sindh mein to obviously top cities wo bhi you know Karachi and Lahore. Magar Karachi ke baad there is a big gap between even Karachi and Hyderabad. But in Punjab it's you know they the the cities they they're very they're a lot closer in terms of the volume and the growth is a lot faster in those cities. So I think it's um isme actually like like you said isme e-commerce ka fayda yehi hai ke aap kahin se bhi kaam kar sakte hain aur aapka jo customer base hai wo pura mulk hai. Aur isme obviously isme humne bahut infrastructure investment investment ki hai. In fact hamare paas Karachi aur Lahore mein Daraz has the most advanced distribution center in in South Asia minus India. Uh takriban 2 million packages din ke sort kar sakte hain almost without any any human intervention. Um to isme you know you you are you do that because your volume is growing very very quickly. Isme Karachi, Lahore, Islamabad se dur log you know ke ilawa log Daraz pe bech rahe hain, Daraz pe khareed rahe hain. In fact I think last year there was about 4 540 can't call them even cities, it would be towns and villages jahan humne delivery ki. To it's you know wo this this this it opens up the whole literally the whole country. Isme like I said isme infrastructure ki bahut zaruri zarurat hoti hai. Humne logistics mein bahut investment ki hai um in the last many many years. Humne payments mein bahut investment ki hai. Um but alhamdulillah wo trend jo hai wo you know it is starting to emerge in in outside of KLI. And the key winning thing for Daraz over there is availability of assortment. Um ke wo cheez unko shehar mein mil hi nahi rahi. To wo kahin na kahin se mangwa sakte hain, wo Daraz se mangwa sakte hain. You know it's if you're in a tier two, tier three city it's not but in Karachi maybe theek hai aap ja ke kahin se le sakte hain. Magar if you're outside of KLI it's maybe just not accessible at all.
That makes sense. In terms of logistics, run me through infrastructure kaam kis tarah se kar raha hai is waqt? So warehousing kahan kahan pe ho rahi hai? Um aapka jo last mile delivery hai wo kab se aap log kar rahe hain? Start se khud kar rahe hain ya is that something that happened over time where you just sort of took over that part of the operations yourself? Um ye jo hai ye kis tarah se hota hai ke yaar chalo Karachi Lahore ke andar hai aur uske baad phir baaki stations mein wo bas pahunchta hai wahan se aage distribute hota hai. Like run me through how the infra works really all across Pakistan.
Yeah, I'll walk you through ek to why we did it. Umm us waqt aur ye in fact humne 2018 se shuru kiya tha Daraz Express. Aur jo uska jo maqsad tha wo ye tha ke jo bhi delivery companies hum use karte the wo bol dete the bhai ye failed delivery ho gayi, ye return ho gaya, ye ho gaya, falana ho gaya. Aur hamare paas koi koi bhi tareeka nahi tha to check ke wo sahi bol rahe hain ya wo galat bol rahe hain. To humne humne is mindset se operate kiya tha ke agar hume agar hume karna hai to hume khud karna padega. Agar hume sahi se karna hai to hume khud karna padega. Aur aaj mashallah takriban 70 se 80% jo hamari deliveries hain wo Daraz Express khud karta hai. Aur in fact jaise aapne shuru mein mention kiya tha Daraz Express mashallah dusri companies ke liye bhi ab hum last mile kar rahe hain. Umm we have about about 90 to 100 hubs and stations across the country. Umm hamare warehouses hain Karachi mein hain, Lahore mein hain. Inshallah we're opening more in the future as well. Aur 11-11 mein I think hamare paas takriban 3-4000 riders aur jin ko hum actually heroes bolte hain. We'll have, you know, these heroes all over all over the country. Umm aur jis tareeke se hum operate karte hain, jis tareeke se infrastructure hota hai wo ye hota hai ke ek to aapka warehouse hota hai. Phir uske saath-saath aapka ek sort center hota hai jahan aapki cheezein ya to warehouse se sort center pe jaati hain ya to aapke sellers apne jo hubs pe aur stations pe jo cheezein drop karte hain wo aapke sort center pe jaata hai. Sort center sort of figures out yaar theek hai and of course this is you know if it's going in the same city then it gets filtered already at the at the hubs. Magar agar ye cheez ja rahi hai Karachi se Lahore aur Lahore mein you know falana falana Gulberg pe koi ek specific street pe ja rahi hai wo hamara sort center us had tak wo actually sort kar dega. To jab wo cheez jayegi hub pe wo master bag jo rider ko jo le jayega, it's gonna be with a lot more certainty ke yaar wo usme koi galti nahi hai. To jab wo delivery ke liye jayega wo ek to apni you know delivery jaldi se complete kar sakta hai, uske success rate badh jaate hain. Aur isme bahut zaruri hai e-commerce mein ke aapka jo lead time hai it's it has to be impeccable because aaj maine order kiya ab 6 din baad agar aap mujhe kuch deliver kar rahe hain to bhai ya to maine le liya hai ya to mere paas paise jo the wo khatam ho gaye hain ya to maine apna mind change kar liya hai. To aapki koshish ye hoti hai ke jaise hi koi deliver kare jald se jald aap unki taraf pahuncha dein. To you know we do a lot of things to make sure ke jo infrastructure jo set up kiya hai wo isi maqsad se set up kiya hai ke ab bas ye nahi hai kisi ne deliver kar order kar diya to ho gaya aapka kaam. Abhi to aapka kaam shuru hua hai. Ab aapko jald se jald unke paas pahunchana hai. Agar wo khush nahi hain to aapko return aur refund like pura khara karna hai. Aur Pakistan mein jo logistics companies thi unka jo infrastructure wo return pe to create hi nahi hua tha because koi aap agar aap koi lifafa aata hai aapka bank se to aap ye to nahi bolenge yaar bank ko wapas de do. Aap le lenge. Cash on delivery didn't exist. Return didn't exist. Ab wo puri cheez hume create karni thi ke yaar return kaise return journey mein kya hoga. Return journey ke andar ghuse to pata chala yaar kabhi kabhar customer bhi kuch galat karta hai ke product nikal leta hai. Kabhi kabhar seller kuch karta hai. Kabhi kabhar rider kuch karta hai. Kabhi kabhar aapke warehouse mein kuch masla ho raha hai. How do you fix all of that? Ab cash mein how do you do reconciliation? How do you ensure you know ke agar theft hota hai to aap kya karein? So it created a bunch of new problems, you know, ke ye infrastructure create karne mein aur yehi koshish aapki ye hoti thi ke agar 100 orders aayein to aapko 100 deliver karne hain successfully. Isme aapko quality pe bhi kaam karna hai isliye quality achi nahi hogi to wo return karega. Agar aapki delivery slow hogi to wo return karega. Agar aap to humne bahut saare you know humne launch kiya to hume pata chala yaar rider bolta tha usne ke wo ghar pe pahunch gaya hai magar wo in fact jhoot bol raha hota tha. To phir humne incentive systems apne khud ke change kiye, dusri 3PLs ki companies ki change kiye. And I think actually ye ye jo humne mehnat ki hai I think this was actually very advantageous for the ecosystem. Aaj agar aap dekhein bahut saare jo brand.coms aa rahe hain ke you know aap dekhte hain fragrances ki company shuru ho gayi hain, skin care, clothing companies wo agar logistics infrastructure nahi hota to wo nahi kar paate. Aaj jo logistics company shuru hui hain jo Daraz bhi jaise wo logistics provide kar raha hai wo wo karne ka sabse bada fayda ye hai ke aap agar agar aap Daraz pe aana chahte hain great magar aapko apni kuch website shuru karni hai aap shuru kar sakte hain. Isliye aapko pata hai jo jo delivery wala kaam hai uske liye aapke paas ek you know ek ek service hai that's reliable. Mujhe yaad hai 2018 mein hamare saath bhi hota tha ke agar cash on delivery hoti thi to phir cash matlab jab mile to mile. To aapko apne khud ke paison ke liye bheek maangni padti thi. Aaj wo nahi hota hai. Isliye aaj competition hai. Aaj infrastructure khara ho gaya hai. Aaj you know cash on delivery ke alawa pre-payments bhi integration aasani se ho jata hai. To uski wajah se aur companies aur aur log ghar pe baith ke ye kaam kar sakte hain. You know wo apni e-commerce website chala sakte hain, wo seekh sakte hain ke yaar online marketing kya hoti hai, performance marketing kya hoti hai. Hume Instagram pe KOLs, influencers wo kya hain. And it's you know like I said you cannot you cannot stop this. You can delay it. Cash ki jo penetration market mein if it's not there, it'll slow down but it will happen. It will happen.
Mujhe ye batayein ke jo aapke is waqt sellers hain, they are all um matlab har dafa jab order aata hai to wo seller hi aapko deliver karta hai and you are basically the middle layer? Ya aisa bhi hai ke sellers ka jo frequently selling item hai wo fulfill Daraz hi kare? So again internationally Amazon ka agar hum dekhte hain to there are those jo ke wait karna hota hai char paanch din wo seller jayega, pack karega, dega. Bahut saare hote hain fulfilled by Amazon. To unhone bade players ke khud se apni warehousing manage ki hui hai. Um and so I'm curious ke jo aapka Lahore Karachi ka hai how does that sort of work in terms of warehousing and you know what's the what's that like?
Yeah. Yeah, so we we were not super creative, we called it fulfilled by Daraz. Um and uh and it's exactly that. Ke agar aap agar aap ek seller hain jo bolte hain yaar mujhe isme jo you know headache aur maghaz maari hai iski I don't want to deal with that. You can put your things in our in our warehouse. Hum uske alag-alag charges karte hain. But jo cheezein jaldi bik rahi hoti hain it's more advantageous isliye picking, packing, sorting har cheez aur sabse bada fayda ye hota hai ke delivery jaldi ho jaati hai. Jab delivery jaldi hoti hai like I said, success rate badhta hai. Success rate badhta hai to you're more likely to actually get paid for the order you had. To agar aap dekhenge for example jo hamari and we also play this on a category. Ke hume pata hai ke agar aap you know koi kitchen organizer order kar rahe hain to aap wait kar sakte hain. It's not like mujhe foran chahiye. Magar groceries is something that is a lot more ke bhai mujhe foran chahiye. Groceries are also very price sensitive. You know so we say ke isme we can actually sort it better. Hum distributors se directly cheeze khareed ke consumer ke paas pahuncha sakte hain. Hum shuru mein to we were doing same day ab hum you know we've we're inshallah we stopped it for some time and inshallah we'll be starting same day deliveries again. Magar woh hum tabhi kar sakte hain wahan jab hamare warehouse mein. Uske saath saath sellers you know they can choose like I said to have it fulfilled by Daraz. Jisme aapki deliveries get sped up and you know they're they're able to get they're able to get to the consumer very very quickly.
And uske andar you mentioned with very few human hands, right? So, um globally humne dekha jab warehousing and fulfillment ki baat aayi ke uske andar there's a lot of automation that's taken place now. Um and more than automation, chuke woh jo baat aati hai na ke trust wala jo element aata hai. I'll go deeper into trust right after this as well. But um because that is the central node jahan se essentially cheez pick and pack ho rahi hai. Toh wahan pe kaafi logon ne additional woh cheezein daal di hain ke yaar aapki video record ho jayegi, aapke paas jo item aapka aapka pack ho raha hai woh wahan par store hua hua hai that can be backtracked. So I'm curious ke is waqt jo aapke warehouse operations hain, how much technology is being used there um to optimize?
Yeah, I think isme warehousing mein you know I think there's still I wouldn't say we're as advanced as some of the other places in the world from a warehousing perspective. Aur actually to be honest agar aap automation aap dekhein supply chain mein you need it more on the sorting side than you need on the warehousing side. Warehousing is a lot more about having, you know, the way your picking strategy is, where your products are placed. Um uski hum saari you know we we do a lot of automation on that side. Um but where we've invested very heavily is on the sort on the sorting side. Ke product aata hai where so it's a warehouse sort center ya koi hub se sort center. So how do we most effectively make sure that it's going to the right hub that it has to get delivered and the rider can pack it as quickly as possible to to get the delivery done very very quickly. Warehousing you of course it's it's great to have that automation but it's not as you know the ROI doesn't always make as much sense.
Woh obviously agar hum west se compare karein toh unki toh cost of human labor bahut zyada hai na. Woh Exactly. Exactly. Jo hamare yahan kaafi dafa actually woh jo robots aap daal rahe hain in a load shedding environment woh shayad mehenge pad jayenge versus human doing that that that job.
Exactly. And you have to and you have to solve for the peaks, right? Agar jaise sort mein I think jab humne decision liya tha woh jab liya tha ke ek hamara 11-11 ho raha tha jab main aur hamare jo chief operating officer the hum dono baith ke sorting khud kar rahe the sort center mein. Um and we're like this next year it's gonna be even tougher. Yeah. Toh it's like we we know we would break something and then we're like yaar ab hume solve karna padega. And jaise even last mile you don't need to automate because theek hai aap agar aap 4000 banda hai aap 10000 banda laga sakte hain ispe. You know you can automate that and it's like you said it's cheaper in Pakistan so you can say yaar theek hai magar sort center mein aap nahi kar sakte because you have a limited amount of space and if you need to sort 2 million packages and you have space for 100,000 packages toh aap kaise karenge? Aapko iska matlab 20 din lagenge woh sort karne mein that cannot happen you know in a in a place where log expect kar rahe hain ke bhai mujhe maine 11-11 pe order kiya hai mujhe bahut achi deal mili hai koi you know koi item pe mujhe foran chahiye. So yeah.
Makes sense. Um tell me about the trust aspect. So you mentioned ecosystem a few times, right? And um I think 2018 till date a lot has changed for e-commerce in Pakistan. Um jab is tarah ki cheez pehli dafa Pakistan mein aati hai toh it was only logical ke iske andar jo hai na woh masail aayenge. And I feel like a lot of the criticism agar kabhi mila hai kisi bhi e-commerce player ko, um toh uske andar people did discount the fact ke yaar there is a difference between a platform and there is a difference between ek naya um ek ek nayi space khadi ho rahi hai again in a low trust society jahan par har banda usko hack karne ki koshish karega. It's not that those things are happening, it's what needs to be seen is ke uske follow up ke upar rectification mechanisms kya lag rahe hain. Obviously all sympathies to those people jo darmiyan mein collateral damage bante hain because uske dauran collateral damage hota hai. Um how has that sort of evolved? And I think platforms were at the worst end of it because for the vast majority of consumer they did not really understand ke you are the intermediary layer. They for them even till date I would say jo bhi naya consumer aa raha hai ab toh aapke I'm sure aapka ek evolutionary pura ek system hoga ke yaar aapko pata hai yeh naya banda aaya hai isne pehle che mahine kya karna hai, agle che mahine kya karna hai aur do saal baad kya karna hai, right? Because woh naya naya evolve kar raha hota hai. But generally um trust has been a major problem in Pakistan. Um and I feel like that is the number one thing agar ab jab hum scale ki baat karein, bahut saare aur masail solve ho gaye na? Um logistics solve ho gaya by and large. Um payments ka ek issue tha jo ke you know bahut zyada bada question tha ke yaar cash on delivery se hum digital payments pe chale jayein, uske upar bhi rails bich chuki hain, bahut aggressively kaam ho raha hai. I think it's only a matter of time before a lot of that irrespective khud se change hona shuru ho jayega. Um paison ki payment ke masle the jo aapne baat ki. Um uske upar already ecosystem ab aisa ho chuka hai ke aapko pre-payment mil rahi hai ya aapko um you know woh jaise hi delivery ho gayi toh aapne payment nikal li uske upar models aa chuke hain, products aa chuki hain jiske around aap jo hai woh apna cash flow manage kar sakte hain. Trust still though is is something jo ke it's not an easy problem to solve because when you have tens of thousands of nodes and human hands uh participating in the infrastructure wahan par problems toh aayenge. And usme I'm curious ke what have you guys done over time uh to solve for that problem?
So that's a very good question and and I think isme pehli cheez toh woh yeh dekhni hai ke yeh jo trust ka masla hai yeh sirf Pakistan mein nahi hai. Aur jo issues online shopping mein hote hain woh sirf Pakistan mein nahi hain. As e-commerce has evolved in the world this has been an ongoing and you know existing issue that is that that platforms and sellers have had to circumvent. Toh isme ek toh yeh hai ke hum humare my principal assumption is you're innocent until proven guilty. But then if you're guilty, you're not welcome to play in my playground. Theek hai toh yeh isme yeh rules hain aap aa sakte hain. Magar agar aapne rules break kiye toh aap nahi khel sakte. Hum you're not welcome here. Toh agar aap for example ek product aap you know customer ki taraf bhejte hain aapne customer ne ek thermos yellow color ka order kiya hai aapne aapne koi plastic ki botal bhej di hai. Toh isme jab customer return karega toh ek toh aapko financial penalty lagegi. Phir aapka product jab QC mein aayega aur waqai mein agar yeh hua hai toh aapka product ek toh de-list hoga. Phir aapka jab product de-list hoga toh aapki boosting boosting saari jo cheezein hoti hain woh saari cheezein neeche chali jaati hain. Toh you have you know you basically are like yaar main ek dafa bech sakunga, ek dafa mein mera fayda ho gaya toh ho gaya and then that's it. Magar customer bata dega ke yaar yeh toh you know yeh isne galat kiya tha. Magar obviously yeh nahi hota hai ke har dafa seller hi galat kaam kar raha ho. Customers bhi hote hain jo karte hain. Toh how do you figure out ke yaar customer is dafa galat hai seller? And that's where data also comes in. Again you you assume innocent until proven guilty but then you start monitoring their data. Ke agar ek falana customer yeh you know 100 orders karta hai aur uske 20% woh accept karta hai, 80% toh reject kar deta hai aur woh yeh you know falana woh toh over time we start narrowing these things down and restricting because it's not just an issue for sellers, it's also an issue for customers and vice versa. But there is no crystal ball and there's no sort of you don't know exactly ke where in the supply chain did this have an issue. You learn over time, your models learn over time and you start you start focusing on what is the most likely situation. And in this of course you have to keep in mind ke aapko ek return journey bahut aasaan karni hai toh aap for example Pakistan mein I think there's 15 cities jahan aap agar return karte hain apna product ek toh hum 14 day hamari return policy hai. Magar agar aap product return karte hain toh hum hamara rider hero woh aapke ghar pe aapke aapka product uthayega. Aur agar aapne cash on delivery di hui hai toh hum hamara jo product hai woh ab hamare warehouse mein jaake bhi uski QC nahi hogi woh hamare jo local hub hai us pe hi ho jayegi aur agar aapke in fact product aapka sahi matlab aap jo bol rahe hain woh sahi hai woh usi waqt agar aapki cash hai toh usi waqt aapke wallet mein dal jayega, agar aapka card hai toh woh usi waqt hum aapke card mein daal denge. Toh woh you know woh woh cheezein aapko aasaan karna bahut zaroori hai. In fact agar aap Daraz se order bhi karenge toh humne dabbe bhi likha hua hai ke bhai aap return karein. If you're not happy return it. Because it's much better to return it than to have a poor experience. Agar aap if you have a bad experience you'll be like yaar mujhe you know I don't wanna buy again. So woh return ko aasaan karna, woh return journey ko you know to simplify, to make sure ke you know we've worked with the banks to make sure that the money comes to the consumers faster. Um we've worked with the sellers to make sure in fact har mahine hamare takreeban 5000 sellers free mein hum educate karte hain through Daraz University. Usme agar aap ek product agar aap ya toh aapko almost like demerit points milte hain. Aur agar aapke points you know you get you get a certain number of points then you have to take courses and modules on Daraz University to start getting re-listed again on Daraz. Warna we don't let you come back on Daraz. And there's times agar aap baar baar kuch kar rahe hain toh hum permanently aapko de-list kar denge. Ke bhai aap yeh you're not welcome to play in the playground. Agar aap imandari se kaam kar kaam karenge, aap jo customer ko jo bol rahe hain woh denge, aap customer experience ko honor karenge, aap pricing ko honor karenge. Jo hum bana rahe hain uski uski uski basis pe aap karna chahte hain toh please join with us. But if you don't want to play by our rules then you're not welcome to play.
Aapka jo aapne 500 something cities bola, uh city towns, XYZ. Um I think jab aap ek aur badi mazedar cheez hoti hai jab aap actual mein e-commerce ka kaam karte hain na toh aapko breadth and depth of Pakistan ka truly idea hota hai. I remember I main har dafa e-commerce walon se misaal deta hoon but that's basically my experience toh obviously main usi se nikalta hoon. But I actually did a small e-commerce um business between 2018 and 2021. Taught me a lot uh about the industry, about the problems, about all of those things and made me good money as well at that time so main usko kyun deny karoon but um us us dauran maine dekha ke yaar kya kya namon se jagahien thi aur wahan pe kaise kaise randomly order aa raha tha, right? Afghan border pe order aa raha hai, koi random koi town hai, um Fort this, you know, kaun sa Dadan Khan types. Toh I was very fascinated because we were just selling on like Instagram. My wife is an influencer. You actually met her in Sri Lanka by the way, a couple of years ago. Yeah. Toh woh uh you know she would just produce influencer marketing. I would be I'd be surprised yaar yahan pe log reh rahe hain aur woh usko Instagram pe follow bhi kar rahe hain. Mujhe samajh aayi ke yaar Pakistan mein digital ka kitna zyada penetration ho chuka hai, impact ho chuka hai. Um but usi ke saath aapko realize hota hai ke yaar iska logistics kehne ko aasaan hai but yeh jo list aayi hai mere saamne aur is list mein ab agar realistically main sochun toh there has to be a human being at the last mile. Uske sorting bhi uski ho rahi hai, aapne usko saare ko 500 different jagahon pe pahunchana hai, pahuncha ke us bande ne wahan pe karna hai aur us banda woh KLI ka banda nahi hai. Woh banda kisi gaon mein baitha hua hai toh aapne usko train bhi karna hai, aapne ensure karna hai ke woh koi do numbri bhi na kare aur wahan par woh customer ke saath experience bhi manage kare. Pehla toh I'm curious, um are all of these territories completely um managed by Daraz now? Kyunki usme accounting bhi ek hai na. Kuch ilaqe aise hote hain jisme shayad do mahine mein do order ja rahe honge lekin ab aapne toh service karna hai because aapne toh wohi depth provide karni hai jo ke koi aur kar raha hai. Toh I'm I'm curious about how this model works because ek woh news channel wala model hota hai ke KLI bade shehron ke andar aapka reporter hai aur phir wahan par freelancers hain jo ke aapke saath bhi kaam kar rahe hain char aur agency jisne pehle bhej diya, right? So um kya aisa ho raha hai ke koi gaon hai jahan par paanch different companies ke liye ek hi rider hai woh kehta hai ke yaar bas mujhe de dena main toh pahuncha dunga and you know we can actually have a deal. Ya har jagah pe Daraz hi now exist karta hai?
Nahi isme aapne yeh bahut ek valid sawal bhi hai. Isme obviously hum dekhte hain ke volume density kahan hai. Um aur us pe agar hume pata hai ke yaar agar for example do orders aa rahe hain toh uske do options hain. Ek toh jo existing 3PL companies hain unke paas already volume hai. Woh udhar operate kar sakte hain, unke paas chala jayega yeh volume. Ya toh humne ek cheez char paanch saal pehle shuru ki thi called logistics marketplace. Jahan agar aapke paas aap rehte hain Sheikhupura mein aur aapke paas you know you have some money put aside toh aap ek apna khud ka business shuru kar sakte hain where we will give you all the technology, we will give you the volume, magar aapne riders ya heroes ko manage karna hai, aapne training hamari tarike aur hamare mutabiq aapne unko train karna hai. But aap dusron ki bhi deliveries kar sakte hain. But we know ke yaar hamare paas enough volume us jagah pe nahi hai that it would make sense to invest in a hub or a station and and set up an entire team there. Toh we know ke you're already there, you know the people there, you can operate as an independent almost like a franchise business there. Um aur uske saath saath aap Daraz ke saath saath alag companies ke liye bhi kaam kar sakte hain. So there's sort of these three models. Ek toh you can go Daraz Express ke through ja sakte hain, jo 3PL partners hain hamare you know we partner with all the all the delivery companies in Pakistan. Par uske saath saath logistics marketplace jahan in select cities where the density may not be as much udhar woh you know khud ek banda you know he can start his own business and and operate for Daraz and other companies.
You're you're launching I think this is very recent, three days ago ki mere khabar aayi thi. You're launching this sort of Daraz Express now opening it up to the public in terms of ke main agar Daraz pe nahi bhi listed, main agar ek business chala raha hoon toh main Daraz ka infrastructure at least istemal kar sakta hoon, right?
Ji.
Run me through what the thought behind that is because in an extremely um meri jinko retail walon se baat ho rahi thi takreeban teen char din pehle. Aur Jinko ke saath bhi hui aur dusri kis ke saath hui? Allah alam. Nahi, ek aur someone else also. But anyways, they they mentioned ke is waqt 32 players hain logistics ke jo ke Pakistan mein operate kar rahe hain aur you know I mean it's it's sounded crazy to me ke yeh woh news channel wala kaam ho raha hai ke national news ke 50 channels hain. Kitni khabar nikal aayegi yaar national, right? Like toh kitna hi logistics ka woh ho sakta hai ke yeh froyo toh nahi ho raha ke every person is getting into it and so kisi ki bhi unit economics phir manage nahi ho rahi because woh uh you know the volume gets divided. Um and so I'm curious what compelled this decision to get into uh you know last mile as a separate independent entity essentially. Um and separately jo maine aakhri baat boli run me through the unit economics of this this industry because jo mujhe numbers nazar aa rahe hain aur jo main duniya mein dekhta hoon chahe main Dubai mein dekhun ya main US mein dekhun itne thin margins ke ke ya toh site wala banda dekhega woh kahega ya toh yeh burn ho raha hai cash aur yeh crazy hai. Ya woh yeh dekhega ke yaar yeh unsustainable hai because you know stakeholders have to make a win long term. Kyunki abhi aapne thodi der pehle baat ki aapne returns ki baat ki, aapne bahut saari customer experiences ki baat ki. Pakistan mein log customer experience ki bahut baat karte hain. Oh you know US mein main cheezein wapas kar sakta hoon. Um mujhe jo hai na cheez kharab hoti hai foran se replacement mil jaati hai, yeh hota hai woh hota hai. Yaar US mein margin call toh dekho na 10 10 rupay ki cheez woh 100 rupay ki bechte hain. Woh agar ek bande ko return aemi phenk dein ya woh free mein phenk dein yaar yeh le bhai tere liye koi masla nahi hai. Woh us pe bhi margin kama rahe hain, right? Yahan par woh 10 rupay ki cheez ba mushkil 10.5 rupay ki bech rahe hain. Kyunki it's an extremely competitive environment. Everybody is trying to sort of make a make a buck. And so there is a requirement kyunki main jitne bhi last mile se baat kar raha hoon na everybody talks about hum yeh kar rahe hain trust banane ke liye, hum aise kar rahe hain, hum training kar rahe hain, hum yeh kar rahe hain. Neeche aap comment section mein jaate hain har party ke saath kisi na kisi ko zaroor masla hai. Right? And mera thesis yeh kehta hai ke it's because of the race to the bottom jo ke Telco ne kiya tha apne saath jo ke ab yeh industry kar rahi hai prices wise ke jab main 2018-19 mein bech raha tha toh 200 rupaya mujhe on average ek parcel ka ja raha tha. Aaj main sun raha hoon petrol ki price teen guna ho chuki hai, dollar dugna ho chuka hai. Inflation jo hai woh over the last five years koi 40-50% ho chuki hai. Aur us sab mein last mile delivery ki jo cost hai woh 200 rupay se pata nahi 120 rupay pe pahunch chuki hai. How does how does the economics working? Um tell me a bit about that.
It's a very it's a very very good question. I'll tell you ek toh hum why are we doing it and then I'll get into the economics of it. Um and my thesis is similar to yours that you cannot have 32 players that are all gonna do well. This is a game of scale. And why it's a game of scale is because it's like news channels mein aapka jo capex ka startup starting capex it's it's not as insane. Isme aapko agar aapko ek shuru karna hai you in order to do it properly. You can start with variable expense ke yaar maine ek jagah le li main you know sort karunga aur yahan se main nikalunga aur mere riders maine rakhe hue hain and that's it. Magar aapko scale pe karna hai toh it requires a lot of money. Then you think about Daraz ke yaar humne yeh toh investment hum kar chuke hain. Hamara volume alhamdulillah consistently aata hai. Toh mujhe kisi aur ko agar add karna hai toh meri jo variable expense ab main bas variable expense pe play kar raha hoon. Meri fixed expense toh saari hui hui hai. Aur meri variable expense jitni main aur volume dalunga aur kam hoti rahegi. Toh why should I not do it to also lower my variable expense for my entire platform, right? So I can actually take my service and offer it for a more cost effective than someone else to others and thereby also make my variable expense cheaper for myself. Toh isme you know there's there's not gonna be 32 players forever. And you've seen this as well players aaye players gaye players aaye players gaye because you're right. Ek aap bahut aggressively bahut competitive environment mein aap chale jaate hain aur isme it's not only a razor thin margin business, it's a very thankless job. Matlab kabhi aap jaise aapne kaha ke comment section mein sab complain kar rahe hote hain aapko bahut kam milega ke koi bolega yaar matlab kitni achi company hai, kitni jaldi unhone delivery kar di. Aur yeh aapko duniya bhar mein kahin nahi hoga. Everyone is always upset ke yaar aur jaldi kyun nahi la sakte aap. Toh it's
It's a very thankless job, very thin margin job. So in order to make it work, you have to have immense amount of volume and you need to have immense amount of density. Density is there from a, you know, country perspective, but density is not there in terms of e-commerce. Toh woh jaise hamari volume, for example, when I say hamari, I mean e-commerce as an industry, isme Daraz, baqi jo you know, brands hain, woh sab mil mila ke, jaise aapki density barhti hai, your cost per order starts driving down very, very significantly. Main, I remember jab main Canada mein hota tha, toh ek ek jo Amazon ka rider tha, woh ek ghante ke andar, woh I think 16 ya 20 packages drop kar deta tha. Ab woh kyun karta hai? Woh isliye ek woh building mein jata hai aur aath packages ek concierge pe aapne chhorne hain. That's it. Ab wohi banda agar aap, you know, Pakistan aayega, there is not that much density in terms of e-commerce. There is density in people, but not in e-commerce yet. Toh woh karne ke liye, he doesn't have the economics will not make sense, you know? And so I think as the density increases, and so you want to add density. So we say okay, yaar theek hai, ab Daraz ka volume hai, hum aur bhi density add karenge toh hamari unit economics aur bhi kam hongi, aur bhi behtar hongi. Aur humne sara capex already kiya hua hai. Hamari sort center like I said, 2 million packages handle kar sakta hai, jahan there is no one else in the country that can do that, right? And in an automated way. Toh agar unko scale karna hai, they need to actually start spending more variable expense. Whereas mine is a fixed expense and I actually start becoming cheaper and cheaper. And then I can pass those savings on to the consumer. Toh um I think Alhamdulillah jab humne paisa kharch kiya, it was a good time to spend it. Money was more free than it is today. Um aur humne woh Daraz ko, you know, ek advantage dene ke liye from a from a delivery perspective kiya tha. Par uska advantage should be passed on to the entire ecosystem because we can do it in a more cost-effective way. And not only cost-effective, with a better success rate because humne dekha hua hai ki yaar ab ek customer agar you know, agar ek customer reject kar raha hai toh woh kyun kar raha hai? Humne pura hamara incentive system change kiya hai over the last few years. Everything we have done to fine-tune our own deliveries. And now we are saying we are going to take that exact same thing and give it to you at a cost-effective rate. You would be silly not to take it and we would be silly not to do it. Um, what's what about the economics? The second part of the question.
Yeah, so the economics like I said, um that's where Daraz has an advantage because like I said, we've done the capex behind it. Agar aapko aaj capex kharch karna parta, phir aapko volume khud dhundni hai. Hamare paas volume bhi hai aur humne sara infrastructure banaya hua hai. Toh I can do it cheaper. I don't need to do it. I I my cost per package will be lower than you know, profitable, the way you say, while managing the um service. Mujhe yeh batayein ke um and it's it's surprising to me ke it hasn't created the chatter that I expected to create or or kyunke logon ko shayad impact uska bhi samajh nahi aa raha but um last mile delivery is just one aspect, right? Now there are players jo ke bahut saari added range of services de rahe hain. Fintech bhi hai woh ek tarah se jisme woh aapko um aapki aur a lot of these people particularly like someone like the Daraz hain. Um aur uske andar again wohi wali baat hai ke cash flow is king. Brands ka farq scene hota hai. Brands ka yeh hai ke usme cycle mein phir bhi thoda thoda time aapke paas hota hai. At least is tarah main apni we were selling diaries. Toh cycle hota tha har teen mahine baad chahiye hota tha. Hamein do hafte baad mile, teen hafte baad mile, we didn't really care barring the last couple of weeks jab humne actually agle uska karna hota tha. Lekin jin logon ne bechna hai, maal uthana hai, usko bechna hai, us paise ko wapis lena hai, wapis karna hai toh unke liye cash flow is everything. And so that's where a lot of players have started coming in and they've started to um offer you services around that as well and so have created sort of a fintech component. Phir uske on top of that, ab data is now increasingly becoming important where yes, step one, main bahut achhe se deliver kar sakta hoon. Step two, main jo hai woh paisa aapka cash flow nikal sakta hoon. Step three is that within that delivery ecosystem, I can actually reduce the returns. I can actually help you pre beforehand to identify ke what is a potentially problematic customer. Um and so I can actually help you make your uh business more efficient in terms of the delivery and logistics aspect, right? Jab aap isko open end kar rahe hain, toh is it just the delivery? Or are you then adding a range of services? Because I'm quite certain ke Daraz ke paas yeh bahut sara kaam ho raha hoga apne liye internally. Um and so are people going to be leveraging on that existing and analytics that have been happening for Daraz? Kyunki woh usme certainly then it makes a lot of sense as well ke yaar mere paas 2 million ya XYZ jo customers hain, unke upar jo trained data hai, wohi mere package ke liye bhi utilize ho raha hoga and therefore the quality will be much higher. Yeah, absolutely. Look, that's that's exactly where I think Daraz actually has a big advantage. Um and like you highlighted, cash is king, especially you know, in a country where the cost of capital is very, very high. Aur generally jo log khareedte hain, woh jab paise milte hain toh phir aage jaake khareedte hain. Toh isme, you know, we're not doing yet, you know, pre-paying for the for for uh to the seller like some companies are doing. But generally hum apni taraf se bhi we've always had a, you know, ask from everyone that hamein ek do din mein paise chahiye hain. Toh we do the exact same thing for our sellers. Uh so for for for companies that want to work with us. Aur uske saath saath jo hamare sellers hain, they're on a they get paid every single week. But in fact, we're working towards soon they'll have the ability to withdraw it whenever they wish. Jahan unke paise accumulate ho jate hain, woh bolenge click they'll click a button and the money will go right to their bank account to make it easier for for them as well. And then the idea like you said is to give these services that Daraz has to the customers that use Daraz Express as deliveries. Agar hamein pata hai ke yaar ek if for example, you know, abhi agar aap ek phone order karte hain, agar aapne phone ki phone order kiya aur aapne reject, you know, 20% se zyada aapka rejection tha, hum aapko cash on delivery karne hi nahi denge. You know, so we we we haven't built the link 100% yet if I'm going to be honest, but that is the goal is to jo jo Daraz ki jo benefits hain, jo humne data ke through dekha hua hai ke kaunsa customer ko hamein cash on delivery offer karni chahiye, kisko hamein digital payment offer karni chahiye, kisko hamein pata hai ke yaar yeh cancel kar dena chahiye because yeh successfully deliver nahi hoga. Woh saari cheezein phir Daraz Express will be able to actually offer to its to its customers. And like I said, Daraz because it's doing because it's the biggest e-commerce player in the country, hamare paas day one se sara sari information hamein hamare paas hai ke how do you make sure that successful delivery is done? And in fact, right now agar aap dekhein toh jo Daraz ki aur Daraz for Daraz as a for Daraz was a client and others are a client, abhi success rate sabki same hai. So it's not that Daraz ex, you know, the ba jo baqi jo clients hain unki unki success rate kam hai versus Daraz. All of those are they all go into the same system. The the system is agnostic ke yaar yeh you know, yeh Daraz ka package hai ya kisi aur ka hai. Because that also cannot happen, right? Hamara volume bahut barh gaya aur hum bol rahe hain bhai aap apne packages ab aapke aapke packages hum nahi deliver karenge. Bhai, that's not the way this works. Everyone gets it's a you know, into the same pool. Wohi us tareeqe se sorting hogi, us tareeqe se last mile hubs aur last mile riders ke paas jaake deliver hogi.
Jo uh Alibaba ki aapki um partnership ownership hai, um does that mean you get a lot of technology transfer from there as well? Or is this all indigenous to Pakistan, what you have?
No, no, absolutely. We get a lot of technology from them. You know, in our front end like our app, agar hamara pura jo warehouse management system hai, uh hamara jo sara last mile ka system hai, usme not only the technology but also the the pitfalls that they have made. Um and then how do we avoid some of the some of the mistakes that they have made uh when when we are doing it.
Um is waqt aap logon ki jo jo payments hain, do you have a number to how much of that is cash on delivery and how much of that has now started to go towards prepaid or digital payment? And isko actually main teen steps mein divide karunga. Main um Dubai mein mera yeh experience hua ke digital payment does not necessarily mean prepaid. Woh ab yeh bhi hona shuru ho gaya hai ke yaar uh cash on delivery ke bajaye digital on delivery. Um and so that allows for ke mujhe actually rider ke hand mein cash management nahi daalni parti. In fact, woh reroute hoke um peeche se you know, it's direct bank account mein drop ho rahi hai, whatever. And I think that in itself is is a good middle ground between allowing for that trust to be built but also uh making the entire ecosystem more efficient. The reason why I say this is because Pakistan mein mujhe abhi tak woh nahi mila kyunki abhi tak very recently I ordered a bunch of stuff and woh ho hi raha tha riders aa rahe the including Daraz by the way, uh jiske jo jab aaya aur mere paas I just don't do cash. I've had like a credit card since I was fifth grade. Same problem. My father was a banker. Unhone mujhe pehle se jo hai na woh digitize kiya hua tha. Toh jab bhi woh aata tha toh main hamesha yeh hota hai ke you know, for example my driver would say ke bhai woh order aaya hai itne paise hain, kya scene hai? Main usko kehta tha yaar mere paas toh nahi hai, tere paas hai? Woh kehta nahi hai. Toh main kehta yaar usse pooch zara EasyPaisa ka scene hai. Woh literally har rider jo hai woh EasyPaisa apna local EasyPaisa karta tha, phir uske upar woh 100, 150 rupay upar se le leta tha ke yaar iski paise nikalne ki fees hogi. And it would always bother me ke yaar why does he not have some infrastructure jo jisme main iske account mein na transfer kar raha hoon, main direct company ke account mein karoon, koi code aaye, mere paas access mein ho, usse verify karoon, authenticate karaoon aur woh uh kaam chal jaye. Um so pehla toh mujhe yeh batayein ke how much of current payments are prepaid and how much of them are cash on delivery? And then digital on delivery ke aapke kya plans hain ya is that already rolled out and what's happening there?
Yeah. Yeah. So I think before that it's even more important to understand ke why does digital payments matter for e-commerce? Um and the reason it matters for e-commerce is that wohi jo problem aapne jo bola ke yaar aapke ghar pe koi aata tha aur cash mangta tha. Aapke paas do option the ke aapke driver se poochein ya EasyPaisa karein ya usse bolein yaar kal aa jana, main kal cash de doonga. Aur woh kal aa jana bolna bahut aasaan hai, magar isme jo return lag hai woh hub pe jata hai, resort hota hai, usme saari cost barhte hain. Woh cost eventually kisi na kisi ko toh dene hain. Toh it's woh jab fail deliveries hoti hain toh usse seller ki cost barhti hai, hamari cost barhti hai, customer ko eventually cost barhti hai. And then it makes the pricing uncompetitive aur phir banda bolta hai yeh cheez zyada mehngi hai, e-commerce mein main kyun na jaake kahin aur se loon. So it's very important ke we reduce the cost burden to consumers. Toh that's why digital payments is is very important. Toh taqreeban abhi bhi 80 feesad jo orders hain, woh abhi bhi cash on delivery pe hain. 65 uh percent of uh you know, the value, so 35% of the value is on on cards and 20% of the number of orders is on not just cards, call cards, wallets, etc. Um aur isme hamari koshish yahi hoti hai that we we incentivize consumers to start getting on to digital payments. Toh you know, jaise abhi get a get aa rahe hain toh every bank is partnering with Daraz to give special discounts. Um hum education karte hain banks ke saath. Aapke koi bhi bank hoga woh aapko SMS bheje ga ya push notification bheje ga ke you know, you can you can use your card on Daraz and an e-commerce blah blah blah blah blah. Um and and the idea is to teach consumers ke yaar it's safe to use it online. Um isme there's a lot of things that we've had to do. Abhi pehle you know, for example banks ek waqt tha ke agar aap ek cheez return karenge toh refund mein 45 din lag jayenge. Matlab bhai kis duniya mein hum reh rahe hain ke aap aur aap kyun use karenge digital payment? Agar aapko pata hai ke yaar maine ek fridge le liya hai, 1 lakh, 1.5 lakh rupay ka aur 45 din mere paas paise kahin phanse hue hain. You wouldn't do it. So you have to make the the journey of cash and and and digital payment as easy and as seamless. You also have to make the cost as seamless. Agar main aapko 100 rupay deta hoon, aap aake jaake kisi aur ko 100 rupay dete hain, end mein 100 rupay hi bachenge. Magar main transfer karta hoon, aap transfer karte hain, transfer karta hoon toh then through the taxes and the fees it it it it you don't have 100 rupay left. So that that's also very important from a infrastructure taxation perspective that we incentivize digital payments. Toh ab for example, Raast aaya hai, which creates you know, it's because it's it's that it's reduce it's remove that cost issue between digital payments. So now even everyone is incentivized ke yaar ab mujhe you know, 2.5, 3 feesad mujhe kisi aur ko nahi dena hai. Main kyun doon uh you know, koi gateway ko 2.5, 3 feesad jab mera margin hi 5 hai? Aap kyun le rahe hain 2.5, 3 feesad? Toh isme jab yeh Raast aaya hai, which is eliminated some of those costs, it makes more and more people will be incentivized ke yaar ab mujhe adopt karna hai ke isse mujhe cash mujhe payment pehle mil jayegi, successfully deliver bhi ho jayega aur mujhe cost bhi isme itni nahi lagegi. Um toh it's uh you know, this this um this will help in in sort of the adoption of of digital payments and getting people away from from from cash more and more. Sorry, aapka ek aur bhi there was another component to your question. Digital on delivery. Ji ji ji. So now uh in fact taqreeban dedh mahine se we started offering that. And the way this works is aapki agar agar aapne cash on delivery ki hai, toh rider aayega usse ek ghante pehle aapko ek push notification jayegi aur aap aapko push notification mein yeh hoga ke yaar agar aap digital payment karna chahte hain, toh click this button and it will take you to the app. Toh actually jo aapne issue identify kiya tha infrastructure ka. Dekhein isme aapko uh even if you do tap on pay, you need you need you need mobile phones that can accommodate tap on pay. Um Every rider in Hero does not have a phone that can accommodate tap on pay. Um Because most of them are operating in the very, very cheap smartphones jahan sirf aapki you know, basic apps chal rahe hain. So then we were like yaar agar infrastructure ka issue hai, that means agar infrastructure hamein deni hai toh they'll be very expensive. Phir hazaron riders ko phir aap scale karte hain, hazaron ko kaise dein? Phir what are you going to do with all this equipment? So you need to find a way that is actually scalable. So the most scalable way for Daraz is that just aap app pe aap click karenge is push notification pe, it will take you to the app and then you can choose ke aapko card se karna hai, EasyPaisa karna hai, aapko whatever digital payment you want to do, you can do it. You know, so it uh but it still gives you that comfort. In fact, not and and you can do it up to the point ke rider aapke doorstep pe aa jaye aur aap iske samne bhi kar sakte hain ke woh bole ke bhai aap abhi bhi payment digitally kar sakte hain. And like you said, the idea of that is ko jo generally ek lack of trust hota hai, kya yeh product aayega? Kaisa hoga? Falanah. Aapko woh thoda ek dafa overcome karne ke liye, this is a good option. Ke aap try karein ke aap digital and then once you try it with your card, I mean, like you said, you only use your cards and I I do too because mere liye itna aasaan hota hai ke chowkidar ke saath chhor dein. Agar chowkidar nahi hai toh parosi ke saath chhor dein. You know, toh but agar main cash pe rely karta toh main bhai cash toh mere paas nahi hai abhi. Ya toh main ghar se bahar hoon, main aadha ghanta wait kar raha hoon, rider bole ke bhai main toh nahi wait kar raha. Um So you can circumvent a lot of this through through digital payments. Um Globally na ek time ke upar jab uh the Amazons of the world became huge, toh ek thought yeh thi ke yaar uh is tarah ke it's it's it's a last man standing, one person to rule them all, one company to rule them all wali situation seem uh seemingly lag rahi thi. Um jisme waqai aisa tha aur agar aap US jayein toh wahan pe Amazon ka literally yahi wala scene hai ke woh unki gaariyan apni, unka woh main agar kabhi walk kar raha hoon na toh mujhe aadhe ghante ke andar 10 Amazon ki gaariyan nazar aati hain mukhtalif kyunke the entire economy particularly post-COVID has become extremely, extremely e-commerce driven. Um stores waghera jo hain woh khali pare hue hain, main gaya bhi hoon toh khali pare hue hain, jaldi band ho rahe hain. Um e-commerce is so convenient and and and uh you know, uh kaafi dafa sasta bhi hota hai uh jo aapka standard woh hai. So I'm I but over time what we saw was ke woh jo one company thi, woh chunke itna zyada depth usne barha di apni service offering ke andar, apni product offering ke andar um ke kaafi confusing bhi ho gaya customer ke liye, right? Woh uske liye woh decision fatigue hona shuru ho gaya, usko hona shuru ho gaya ke yaar mujhe main yahan par jata hoon, 50,000 options hoti hain. I don't want those options. And so then we saw ke bahut saari companies sort of clawed their way back, the the Walmarts and the this and the that. That ek time ke upar jab woh invest kar rahe the toh lag raha tha ke yaar yeh mazaak kar rahe hain, yeh toh koi fayda nahi hoga. But woh hona yeh shuru hua ke you you began to either see curated um marketplaces jahan par concept yahi hai ke you know what, like we'll give you, we understand you. So hum ek particular customer ko uske relevant sabse ek particular quality ki cheez aapko de denge. Ya managed marketplaces jisme hamein you know, ek particular set of brands ke around uh aapko woh milega. So at least I don't have to, there are certain things jiske andar main um I'm ready to take the risk ke yaar generic cheez aa rahi hai, achi ho sakti hai, buri ho sakti hai, reviews par leta hoon. There are certain things jo mujhe pata hai yaar ek particular cheez hai, mujhe woh main managed marketplace ke baad jata hoon jo ke my understanding is Daraz Mall was that for you guys. Um where you know ke yaar authorized dealer mujhe yeh cheez bech raha hai. Um And so then the at this point in time the narrative has shifted quite a lot. It has become in many ways a competitive space. And Pakistan mein bhi ab hum dekh rahe hain ke there are other players now jo ke mobile phone categories ke andar, technology category ke andar, um fashion category ke andar ab managed marketplaces aur aur niche driven uh usmein aana shuru ho gaye hain. How do you see that competitive environment being built? Uh aap aap aap log apna apne aap ko kis tarah se evolve kar rahe hain to to uh make do with that reality? Um and additionally jab aap jis tarah for example ab aap jaakar woh kar rahe hain na investment mein direct naam bhi leta hoon ke Laam jis tarah hai, Laam ne apna ek fashion marketplace banaya. Us fashion marketplace ke peeche unhone ek technology build kar li. Ab woh us technology ko uh open source kar rahe hain, open source nahi kar rahe but as a product bech rahe hain, right? Um aapne logistics banaya, aap logistics ko toh kar rahe hain, but kya aap technology ko bhi potentially aane wale waqt mein is tarike se uh uh productize kar sakte hain? And then separately because Daraz is now the largest um ecosystem of local products or or or local market, do you think you will go into potentially exports? Kyunki hamein pata hai ek diaspora market exist karti hai, hamein pata hai duniya ki ek market exist karti hai. Main diaspora ko bhi nahi kahunga, mujhe lagta hai hum diaspora ka kehna sirf apne aap ko apni soch ko kahin na kahin mehdood rakhte hain. Um in a in an environment jahan par tariffs ban rahe hain, you know, things are going up and down, wahan par kahin na kahin opportunities suddenly emerge kar jati hain, jahan pe competitiveness suddenly emerge kar jati hai aur wahan par phir infrastructure will define whether opportunity exists or does not exist, right? So kya woh infrastructure jo ke aapne local duniya ke liye, local Pakistan ke liye kar diya, kya Daraz us infrastructure ko globally bhi enable karega at some point in time for the Pakistani consumer? Yeah, I think um isme there are a few things that you that you asked. I think ek toh yeh hai ke you know, if you look at e-commerce in in US and
in Asia, it's far more advanced than it is in Pakistan. In Pakistan, maybe it's two, two and a half percent of of retail. And that means there's a lot more space for for for entrance to come in and to be able to find the niches. And like you mentioned, there are, you know, niche players that operate in different in different verticals. And and the way we're gearing up for that is that you have to identify, first and foremost, you have to admit that every category is bought very differently. Just tarike se aap grocery khareedte hain, us tarike se aap ek kurta nahi khareedenge. Us tarike se aap ek phone, mobile phone nahi khareedenge, us tarike se aap ek you know, AC ya TV nahi khareedenge, health and beauty nahi khareedenge. So, you have to become an expert in all of these categories. If you just sort of expect kya main product laga dunga app pe aur woh bikega, that's not the case. Aapko mobile category ko bilkul alag tarike se aapko manage karna hai versus aap fashion ko manage karenge. Fashion brands ko aapko bilkul alag tarike se manage karna hai versus marketplace of lots of different you know, different sellers on on on on fashion. So, it's for as competition in different industries has emerged, we really you know, we really started digging a lot deeper into the categories. Ki kis tarike se humein alag alag categories ko manage karna hai aur kis tarike se we want to ensure that we are we have an advantage over over players who emerge in the space. Whether they're on fashion, whether they're on electronics, how do we make sure that the consumer prefers buying on Daraz versus them? Isme you know, like you said, there's some consumers might prefer to go to a brand and you can only have that when infrastructure has emerged. Like I mentioned earlier ki jab 3PL companies aayi hain, uski wajah se bahut saare brands ki khud apni website unhone shuru kar di hai ya ya unhone yeh kiya hai ki you know, they've they've used the they've used either Daraz and their own website. So, I think this is this is it's created because of the infrastructure, it's created more opportunities for brands to to to to emerge. And for players like us, it's really also taught us that yaar agar aapko is category mein jeetna hai, so you have to be able to give that service to the customer and you have to be able to deliver what what they want in terms of not only customer experience, but in terms of pricing, in terms of assortment, in terms of the brands. You know, like I said, pichle 60 din mein humne 150 jo brands laye hain, woh isliye kyunki that's what the customer demanded. And it's not necessarily every brand is going to be a top tier A brand. There is tier B brands that sell better than some tier A brands. You know, so it's it's it's what the consumer wants at the end of the day. Second question iska ismein yeh tha ki beyond just sort of last mile delivery, are you hoping to productize other aspects of the business as well?
Yeah, I don't think we will productize the you know, the technology part of it because to be honest, you know, I think like you mentioned, Lam sort of has has created the technology themselves. In many ways, I think we have taken the technology from Alibaba and then manipulated it a little bit to be to be able to fit local needs. But where we are, like I said, everyone should play in what they're excellent at. Hum hamari jo expertise hai woh actually logistics hai. We are excellent at it. Um so we should play in that space and the technology is mostly really just been like I said adopted. So it's not something that we could or would you know, monetize.
And internationally, do you think you're going to get into an in export infrastructure or enable export infrastructure and again context ismein yahi hai ki the problem there is the cost of delivery, right? Um jiska woh Shein model tha, jiska woh dusra model tha jisko um ab locally Lam and other players are trying to sort of figure out ki yaar how do we sort of aggregate um packages, scale ko use karke and how do we reduce the cost to enable the Pakistani seller to reach markets all over the world in the start, whether that is for your local um you know, overseas Pakistani. But eventually, if you have the infrastructure there, to technically speaking, fashion is fashion. Mere hisab se na bahut badi category hai jo Pakistanis jisko kar sakte hain, woh Muslim fashion hai ya you know, modest fashion hai. I feel like that's just popping up and it's huge and usko jitna achha Pakistan samajh sakta hai aur rapidly adopt kar sakta hai because the infrastructure of textile that we have, you know, we can take like it's a billions of billions of dollars of market. Consumer baitha hai pura from all the way Indonesia se leke Turkey tak. Um but usmein woh yeh hai ki we need that infrastructure and that has to happen from a big player. Usmein koi startup nahi kar sakta because that's a cost intensive sort of economy of scale business. Do you think you'll ever be kyunki aapke paas woh seller exist karta hai, aap usko enable kar sakte hain, to kya aap usko solve karne ki taraf jayenge?
I think eventually hum jayenge. It's probably not going to happen in the next 18 to 24 months, magar hamare liye bhi zaroori hai ki hum export ki taraf eventually jayein because ismein dekhein na to sirf ab ismein Muslim wear hai magar aisi bhi categories hain jahan Pakistan as a country has a cost advantage. So actually, you know, you if you even compete versus China, you can deliver to the consumer not only in Muslim countries, but to South Asia for cheaper. Agar aap toliye for example agar aap saste bana sakte hain ya bedsheets saste bana sakte hain, to consumer ko nahi parwah hogi ki yaar yeh Pakistan se aa raha hai ya yeh China se aa raha hai ya yeh Vietnam se aa raha hai. Woh chahega ki yaar yeh cost effective cheez hai, quality achhi hai. To aap actually sirf na to sirf Muslim wear jo Pakistani brands ya fashion bana rahe hain magar as a textile and you know, as a as a textile industry, you can start catering to customers outside of the Muslim world as well to to you know, consumers globally. So I think there's definitely an opportunity there. Ismein like I said, we've we will inshallah look into this at at you know, in down the road. But to do it right now, it's a bit of a distraction. That's why we haven't done it. We really need to solve, we need to crack Pakistan and then inshallah with that we're going to go into to to other countries too.
That makes sense. Um main thoda sa isko wrap up ki taraf lekar jaunga but I'd be curious, you've mentioned quite a few times and I know it's just right around the corner. Um 11-11 is is is huge. It's something that you guys really champion and created and now it's happening across the industry um ki uske around bahut saari sales hoti hain and it's the biggest consumer event in the country. Um pehla to yeh ki do you have any numbers of the last few years of again the volume uh or or or the impact that happens during this time?
Yeah. You know, generally when we do 11-11, we're hoping to do 10 to 20 X of our daily volume. Which from an operational perspective is a nightmare and very, very difficult. But the reason that 11-11 becomes successful is that it's actually an entire ecosystem jismein brands apni taraf se unke naye launches late hain, naye products late hain. Uh pricing you know, sellers and brands give the most the lowest pricing that they've given in the in the year. Usmein aapke banks go most aggressive in terms of you know, not only marketing but but the discounts they give. Um and you have your offline partners involved in it. You have entire everyone sort of coming in together and it makes a really explosive sort of event in in in in 11-11. And you know, agar aap dekhein ki jab humne pehli dafa kiya tha to November was not necessarily a buying season. October, November was not you know, people maybe towards end of November were getting ready for shadi season. But now 11-11 has become like you said har jagah aapko offline bhi kahin jayenge aapko 11-11 ki sale dikhegi. To in fact hamara jo is dafa creative hai woh yeh hai ki Daraz is the big boss of 11-11 because baaki sab bhi baaki sab to karte rahenge magar you know, we are the OGs of of 11-11. To ismein um ismein you know, there's a lot that we've done to build up. In fact ab aap dekhenge to there's a lot of humne pichle saal mein we've done you know, ek ek do do teen teen. So what makes 11-11 different? 11-11 what makes it different is that the amount of players, the amount of discounts, the amount of assortment. I mean, like I've been you know, in the last in fact I think just before this session, I was on the phone with a brand negotiating the price on one SKU. And you know, I know ki yaar mujhe yeh cheez jo mujhe is price mein mil rahi hai ki mujhe zaroorat bhi nahi hai main le lunga ki agar agle saal mera TV kharab ho gaya to mujhe hona chahiye yeh TV is price mein mil raha hai ya yeh AC ya yeh you know, headphones ya yeh fashion ki jo cheez hai, mujhe is price mein milni hai main abhi se le lunga. So I think it's just everyone coming together to create this the the massiveness of of of 11-11. And um you know, it's uh it takes a lot of work, a lot of planning. Um I think pichle do dhai mahine se I don't I don't think meri koi aisa aisi raat hui hai jahan mujhe puri neend mili hai. But inshallah I'm I'm very hopeful that you know, next week when we do the event, um it'll be able to deliver this value to the consumers and sellers because sellers also look forward to it. In fact riders ek dafa hum log you know, we do a management on the go jab hum alag alag hubs pe jate hain to ek rider se humne pucha yaar what does 11-11 mean to you? To usne kaha yaar 11-11 Eid hoti hai hamare liye. Isliye itne packages hote hain ek ek mauka hota hai ki paise bana sakein. Um sellers ke liye bhi yeh hota hai ki woh pura saal wait karte hain, woh planning karte hain us hisab se ki 11-11 aayega to 10, 20 guna zyada volume aayega. Consumers plan karte hain ki yaar mujhe ek you know, big purchases karni hai ya ek shadi season aana hai mujhe alag alag cheezon ki zaroorat hai to main 11-11 pe lunga because the the deals and are are really once in a year if not in fact some of the deals that we have this time it's cheaper than what it was a year and a half ago for some of this assortment. So um it'll be quite exciting inshallah.
Interesting. Um yeh jo aapki 11-11 sale lagti hai, iske upar and and main curious hoon because I actually spoke to an individual jo ke Pakistan mein na ek zamane mein aaya Amazon VPA and Amazon marketing and this and that. Aur tum ek gentleman se meri baat chal rahi thi, unhone mujhe kaha ki yaar Pakistan mein logon ko concept hi nahi hai. Everybody is after Amazon, they don't realize the opportunity that Daraz has to offer. Um obviously ek zamana tha jab aapka bada simple tha, yaar jao jaake apni product launch kar do aur woh ho jayega. But ek certain critical mass jab aa jaati hai to it becomes a bit more complex. Uski phir marketing bhi ho jaati hai, again jis tarah se Amazon ki exist karti hai. So I'm curious ki jo aap logon ka local ecosystem hai, not just of sellers but also now other other people jo ke products ko market karte hain, jo ke products ko rank karte hain, jo ke ensure karte hain ki woh achhe se bike, jiski ab to uske upar ek ecosystem of jis tarah bahar exist karta hai ki yaar ek zamane mein products bas padi hoti thi. Ab to products ki images bhi aa rahi hain, uska metadata kis tarah se integrate hua hua hai. How do you see that ecosystem? Do you have infrastructure at play jiska sirf kaam yeh hai ki you know what? Because that also impacts the experience of the customer. And wahan par yes, sellers are important, uh but beyond sellers yes, you can educate them as well, but beyond sellers now ek certain scale ke baad uh it's very, very important to convert that seller, a single seller into sort of an agency that has other roles as well because wahan se job creation hoti hai, wahan se phir bahut saari opportunities emerge karti hain. So how do you manage the community aspect of of of Daraz?
Yeah. Dekhein ismein like you said, hamare bahut kam sellers hain jo jisne agar akele shuru kiya tha woh abhi bhi akele hi operate kar raha hai. Usko apni obviously you know, simple things like picking, packing, sourcing, magar uske saath saath account management. Dekhein ab aap Daraz pe aap for example Facebook ki tarah aap pay per click pay per click kar sakte hain search pe. To agar ek banda earphone search kare to aapka product aaye. To how do you optimize kaunse keywords aapko karne hain? How do you you know, what sort of discounting strategy should you have? Should you participate in campaigns? Agar aap participate karte hain to kis qisam ki aapko discounting deni hai ki consumer aaye, khareede. Um you know, we give a lot of that visibility to the consumer. In fact hamara ek opportunity center hai jismein hum yeh bhi batate hain ki yaar yeh falane products hain that consumers are really searching for, they really want it. Aur is price pe inko chahiye. So we give them that insight and then it's our job to make sure ki yaar agar aap humein achhi quality ka product achhi price pe dein to we also need to convert it. Ab aap personalization ki duniya mein jahan 20 million product hai, ab Muzamil Hassan ko agar koi cheez dekhni hai, I need to show it to him. Agar Ahsan ko kisi aur cheez mein interest hai, usko woh dikhni chahiye cheez. Aur I need to make sure ki agar consumer agar seller mujhe pricing de, quality de to meri zimmedari hoti hai ki woh product main bechu. Woh actually consumer ko dikhe aur woh consumer khareede. To isiliye hum marketing itni karte hain aapko obviously you know, pure mulk mein har jagah billboards, TVs, etc. aapko dikhenge 11-11 ke maane mein aur hamara maqsad yeh hota hai ki you know, we make sure that we take on that responsibility when the when the seller does his part. Ki jab on site hum un cheezon ko optimize karein aur woh cheez dikhayein that that really the consumer really needs to wants to be able to buy. And then you know, we give that insights to the seller ki woh bhi he can also maneuver things ki yaar aapka product hai 1100 rupaye ka aur jo bik raha hai woh hai 800 rupaye ka. To you know ki yaar ab aap mein main agar price decrease karunga to maybe I can get more visibility and more optimization on search and I can perhaps sell more.
Um aapne bola ki 11-11 ke log wait kar rahe hote hain ki you know, spike aata hai, sara kuch hota hai. Agar main generally usi ko extrapolate karun over the entire year, to how do you see the consumer spending shifts uh during the year? Koi aapke paas insight hai on kis time ke upar ek dum se badhti hai ya yeh completely random hoti hai? And then I would also like to know ki between 2022 till date, darmiyan mein jo economic crisis ke bumps aaye the, to was that directly reflected? Like were you able to see that data reflect on on on your top line and bottom line as well? Uh ki yaar ek dum se ab consumers ke haath ruk gaye hain. Um aur usse direct impact pad raha hai.
Yeah, look I think um definitely ismein seasonality to bahut hai. You know, agar aap summer ke months mein jaise jab garmiyan hoti hain to your your home appliances, your ACs might pick up. Uh your shadi season is now so your fashion, health and beauty, those things pick up. Eid time, your depending on the Eid, your either groceries are picking up or your health and beauty is picking up. To you know, we have seasonality based on all the different events and the weather changes that that are happening in in Pakistan. Um and and you know, it's it's been interesting actually yeh jo phenomena jo aap bol rahe hain ki in terms of obviously jab mehangai bahut ho gayi thi and jis bande ke paas agar 20,000 rupaye kharch karne ke the, that's all he still has. It's not ki ab uske paas ya to you know, yeh woh bhi inflation ke saath badh gaye hain. To a lot of brands actually started you know, adjusting the size of the products that they were selling. You know, in fact mujhe yaad hai us waqt pe ek ek AC tha jo it was pehle aapko sirf ek ton se ek ton ke AC se kam aap lete nahi the. Ab aap paune ton ka AC bhi aa gaya because that's the price point that fits. People are more willing to trade off features ki yaar theek hai yeh nahi hai, it's okay. Yeh falana cheez nahi hai, it's fine. Agar packaging thodi choti hai main thode aur chala lunga. Agar you know, yeh sachet thoda chota hai, it's okay. I'll I'll stretch it a little bit longer. Um and I think we're starting to see that reverse a little bit now. Alhamdulillah spending is starting to increase again. Um you know, khas tor pe Punjab pe you see more spending starting to emerge than you do in in in Sindh. But the the the the people are starting to spend again in in in Pakistan and that that that pressure is not as much as it was you know, in like you said jab economic crisis ho raha tha. And Alhamdulillah I think as a country we're starting to pull out of it slowly so you can see consumer spending uh you know, pace accordingly.
Right. Do you do you guys have any plans of launching Daraz basics or Daraz originals or um again you guys have the understanding of the categories, you understand ki yaar sabse basic yeh cheez bikti hai, bikti hai, har saal bikti hai. Um you have the data really to uh expand on that uh the the margins of that particular category, but also to be able to provide with a certain baseline of quality, right? Again, um t-shirts hain, basics, um technology ki bahut saari cheezein hain. Yeah, we've done it before. We've never done it so super well. So we've actually decided ki yaar this is not the game that we are we're experts in. Let's focus on the things we're good at and let's make sure we do that exceptionally well. To uh you know, abhi to koi plan nahi hai to go back into that because it's uh it's it's a different game going to manufacturing, designing, etc. Hum karte the, like I said, we were not excellent at it. So we would rather do the things we're excellent at. Right. Um and then the one last question. You know, there's a lot of chatter around AI. Um that's the next big thing, possibly a bubble. That's what I believe. Um but bubbles also happen for a reason, jaise ki dot com bubble tha. It does not mean it's a it's a timeline thing. It doesn't mean ki uska impact woh nahi hai. And so it's becoming increasingly clear ki yes, AI is the next revolution. You can argue about ki woh shayad is time pe overhype hui hui hai to woh shayad do saal mein woh changes na lekar aaye jo ke woh keh rahe hain. Shayad 10 saal mein lekar aaye. Um but increasingly everybody has to integrate AI into some form of the other in their strategy. Chahe woh bilkul internally ho ki yaar hamare workflows kis tarike se AI optimize karegi, chahe woh consumer centric ho ki yaar AI jo front end hai ya front layer hai, woh kis tarike se aane wale waqt mein change hogi. Um jismein you know, e-commerce inherently largely is a search engine business or a platform business jo hai. Um but search search engines jaise ek sort of unified central us pe aa rahe hain to um isi tarike se e-commerce ka bhi yahi hai ki you know, how do we sort of SEO ki replacement ab ho rahi hai with GEO, I believe. Um aur isi tarike se agar main Daraz pe jata hoon ya main kisi platform pe jata hoon to aaj ki tareekh mein main jata hoon, main keyword search karta hoon, uske around mujhe products randomly show hoti hain, there's a recommendation engine, right? Kya uske andar main AI ko use kar sakta hoon ki woh main jata hoon jaake woh mere paas ek sales agent aa gaya aur main usse keh raha hoon ki you know, I am I want this, mujhe isse batao, is tarah ki cheezein batao, time is tarah ka hona chahiye, quality aisi honi chahiye and then suddenly from the 100,000 assortments, woh mujhe optimize karke ek uh uh cheez aa karke beche. Again, um taking e-commerce one step further and bringing in the user experience jo ke mujhe retail mein milta tha ki yaar customer service mein woh banda aa raha hai, woh aake mujhe samajh raha hai, mujhe guide kar raha hai aur phir mujhe jaake redirect kar raha hai to a particular product and in the process woh mujhe saath saath educate karke upsell bhi kar raha hai ki by the way, because you're getting this, there is a very high chance ki tumhe is is cheez ki bhi zaroorat padegi to dekh lo yeh bhi dekh lo cheezein. Abhi to woh bade ek rudimentary tarike se hota hai na ki customers love buying these these these things together. Would you like it? To main woh randomly hota hai, main kehta hoon nahi, dekho whatever. But agar woh ek sort of personalized experience hai, um I don't know, avatar based hai, chatbot based hai, to that that can make it much much better. Yeah. Do you are you guys thinking about AI um both in within your workflows, within your your sort of corporate side of things as well as consumers?
Yeah, absolutely. If you're not, then you're being you're being stupid to be honest with you. Um I'll give you an example how we've used it recently actually ki agar koi seller ek tasveer leta hai specifically for fashion items, to you know, the models that exist today, we we were not able to take a random picture of our own
and to make it such that jab picture app pe, it's something that is actually something you want to buy. So we used, we we actually trained an AI model to be able to take those products and make them such that they actually fit, you know, that shows a Pakistani AI model, an actual model. And and it's, you know, clothed like it, you know, it would a Pakistani outfit would be worn. Um so we've already we've already started exploring it on that side. Abhi bhi agar aap app pe jate hain, seller se bhi sawal puchte hain, to the AI bot will actually start responding to you until unless the seller needs to get involved. Even if you go to our own customer experience, customer service center, whatever we can handle very quickly through AI, we will handle. And the idea and the plan is to use more and more AI to make the consumer's life easier. Jaise aapne kaha agar aap you know eventually aap ek search mein aap describe kar sakte hain aur in fact describe karke agli dafa mujhe pata hai ki yaar, Ehsan sahab ko is qisam ki cheezein pasand hain, to woh you know it becomes a lot smarter. And so I think this is actually a huge opportunity for for advancing e-commerce in Pakistan because hamare sellers abhi bhi woh matlab 98% of their market is offline. To woh you know picture agar cheez ki lega, he'll just do it quick. He'll take a picture and he'll you know he'll be like yaar nahi bik raha, nahi bik raha, kyun nahi bik raha. Bhai aapne na to title likhi hai. Ab hum AI ke through title suggest kar sakte hain, sizing suggest kar sakte hain, hum product ki jo photo hai usko you know we can clean it up, we can put it the way it should be. So we can do a lot of things through AI models that that make it that make it more more scalable and for the seller to be able to take more advantage and to mature more. Because abhi usko you know yeh figure out karna hai ki title mein main English mein kya likhunga, mujhe pata hi nahi hai kya likhna hai, to yaar kaam karta hoon main nahi bechta Daraz pe. Woh saari cheezein solve ho jaati hain through through AI. So I think it gives it actually to me I look at it as the ability to leapfrog. You know, in the 50s, countries that invested in manufacturing were able to really leapfrog other other you know other economies. And to me, AI and the the appropriate utilization of it can help Pakistan, especially when we will not be able to we cannot just do a linear catch up to everyone else. We have to do a step function catch up. To ismein we will have to do, we will have to utilize AI to be able to do that step function and and you know and and not just be able to do slow, slow, slow catch up to other economies. Ehsan, I'm going to wrap this up. I'm going to ask you a couple of last questions that I ask all of my guests and I'm curious to know about your response, particularly based on your own life. Um you've grown up primarily outside of Pakistan. Start mein humne iske upar baat bhi ki, you know, kya aap wapis kyun aaye, kaise aaye, aa gaye, chalen achi baat hai, lekin aapke aane ke baad jo hai woh teen char nazuk mod Pakistan ke mazeed aa gaye. Um to zahir hai banda sochta to hai aur khas kar aap hain bhi Karachi mein. It's a tough place to be in. Um Islamabad, Lahore comparatively much much much more different. Um and so I'm curious to know two things. Pehla, knowing what you know now, seeing what you've seen and the exposure that you've had globally, um how do you see Pakistan of 2050, 25 years from now? And I want you to you know not answer this question with any ifs and buts. Ke if we are able to do this, if the government is able to do this, if people change themselves like this, but rather just take whatever you see right now and sort of try to extrapolate that based on the variables that you know, certain variables that are a given fact that jo cheezein ho rahi hain. Um you know, populations ki ages up and down ho rahi hain, um innovations certain expected hain aur woh ho rahi hain. Um to uski nature ko aap badal nahi sakte, usko aap shayad timeline ko thoda up and down kar lenge. Us saare ko madd-e-nazar rakhte hue aap Pakistan ko kaise evolve hote dekh rahe hain over the next 25 years? And then maybe start off with ke aap e-commerce ko ya digital uh ya digitization of business ko um agle short term mein, 5 years, medium term mein, aap kaisa dekh rahe hain and then go towards Pakistan in general in the next 25 years?
Yeah, look, I think ismein you know, as digital payments grow, um as yeh jo trust grow hota hai, seller ki maturity grow hoti hai. Um aaj agar ek seller jiski 50% sales e-commerce se aa rahi hain aur jiski 10 saal pehle ek feesad aa rahi thi e-commerce se, jiski 50% aa rahi hain, woh he is going to focus on making sure ki woh jo experience hai woh customer ke liye achha ho. Isse uske yaar karobari log hain. To agar karobar kar rahe hain to he needs to make sure ki woh experience achha jaye. To I'm very optimistic ki e-commerce will continue to penetrate. Abhi aap yeh bhi dekh rahe hain jis pichle ab aapne kaha ki 32 companies hain jo logistics kar rahi hain. Jaise jo companies shuru karti hain logistics, uski wajah se phir uh brands operate kar sakte hain, sellers operate kar sakte hain. To I think e-commerce penetration is not a matter of if, it's just a matter of of when. Iske saath saath look, I'm very optimistic about Pakistan of the future. It doesn't mean that there's no problems. I think you know, if you I also don't think there's any point in talking about the problems because most people will just talk about the problems. Aur agar aapko problems dhoondne hain to aapko problems milenge, bahut saare milenge. Magar aapne in my opinion, you need to focus on the you need to really, like I said, look at the flowers and look at what is the most you can make out of it and what are the things you can control. I spoke a little bit ke jo Pakistan ka talent hai, that's top tier in the world. I think that really inspires me ke yaar you know, we we have a country jahan you have you know over 225, 250 million people, growing population, yes, but a young economy. Young economy is, you know, it has opportunities with it. Yes, there's deep issues that can go wrong as well. But there is opportunities for this young economy. They are generally more likely to solve problems, more likely to you know, change things. And and I think that gives me a lot of hope ke jo uh you know, Pakistan of 2050, inshallah, will be a better Pakistan than than the one we have today. And and I think all of us have to take on the responsibility to do it ourselves. So I you know, I I think I'm also maybe a hopeless romantic and that is that I don't I try not to focus on too many of the problems. Because then it just it's a spiral where you just get lost ke yeh bhi masla hai, woh bhi masla hai and then suddenly it's all masle. To you know, I think you have to sort of be able to pull out and focus on the things that are that are good and the things that are positive and and um and and hope for the best and uh and and plan accordingly and uh and you know, look for our for problems and challenges as opportunities. And I think Alhamdulillah Pakistan, you know, it gives you many challenges and opportunities that you can that you can explore. To I'm hopeful about the Pakistan of 2050, inshallah, and I hope, you know, it saddens me a bit that people are so hopeless about it because hope is it's the it's the foundation of all of this. If you become hopeless, there is no way that you're going to solve the problems. You have to maintain hopefulness. You have to if you have to almost remind yourself to be hope hopeful. In fact, that's why even in Islam, it's so frowned upon to be hopeless. You know, because hope hopefulness is a starting point of you solving the issues. If you're like yaar yeh to it's done, then you're not going to do it. You're not going to solve it. So it's there's no reason to be hopeless. Whatever happens, there's no reason to be hopeless and and you almost have to pull yourself out and say ke theek hai main kaise karunga? How do I make this better?
Makes sense. Uh Ehsan, thank you so much for taking the time out. I wish you all the very best for this year's 11-11 sale. Um and particularly with the Dex platform that's sort of opening up and um you know, I'm curious to see how that sort of grows and what additional value you can add to the ecosystem. Um I know it's a competitive environment but you know, I'm excited to see what what happens there. Thank you so much. Very nice chatting with you and thank you so much for having me today. Likewise, and for all of you guys, let me know in the comment section below. Um I'm quite certain Daraz as aapne shop kiya ab to hoga, karte to honge. How's your experience been? Has it evolved over time? Has it gotten better? Um let me know in the comment section what your feedback and overall experience is. Uh but nonetheless, this was say Muzamil Hussain Zaidi, you're watching Thought Behind Things. Thank you so much for watching and I'll see you in the next one.
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