Yango Tech: Tech Stack for Profitable E-Grocery

Yango Tech: Tech Stack for Profitable E-Grocery

By Erika Masako Welch, 22 August 2023

The e-grocery industry is experiencing rapid growth as more consumers opt for online shopping to fulfil their grocery needs. The convenience of doorstep delivery and the ability to browse and purchase products from the comfort of your own home has fuelled the demand for e-grocery services. 

Whereas many businesses succeeded in getting online in one way or another over the past few years – whether it be through social media, advertising, or via a website; the struggle to differentiate yourself in the market also moved to the internet, forcing small businesses to compete with everyone on the world wide web. Once you go digital, winning requires technology adeptness, whichever way you look at it. In today’s market which requires technology-advancing business moves, the key to success may lie in choosing the right partner to implement the technology behind a profitable e-grocery business. 

In frame: Max Avtukhov, CEO & Co-Founder of Yango Tech

In frame: Max Avtukhov, CEO & Co-Founder of Yango Tech

Online Groceries & the Omnichannel Shopping Experience

Though recent market shifts have forced more people to try online grocery shopping, e-grocery isn’t as new a concept as you might think. NetGrocer pioneered the concept as far back as 1997 – that’s over 25 years ago. Then, FreshDirect in the US in 1999 was the first to start delivering perishable foods to consumers without maintaining a retail operation, catering to socially conscious consumers that desired local organic foods. Even Amazon Fresh, Amazon’s broader e-grocery and delivery platform is fifteen years old.

Today’s significant growth has mostly been driven by consumer habits created during the pandemic restrictions – which enlightened customers to the convenience, 24/7 availability, efficient shopping planning, fast order fulfillment and delivery, re-ordering capabilities, and easily available product details that online grocery shopping offers. It's been reported that over 7% of the world’s groceries are purchased online today, with online grocery sales expected to reach a whopping US $250 billion by 2025. 

The most common consumer profile is that of the hybrid shopper – the consumer who buys groceries both online and in-store. Hybrid shoppers are quickly becoming the norm, and it is these shoppers that grocery retailers must cater to by developing an omnichannel strategy. The challenge that omnichannel tackles is that grocers must meet the needs of those that wish to hand-pick their groceries, while also allowing for the flexibility of online ordering – which may seem like two entirely different business models. That, however, is not the case.

Yango Tech: Overcoming E-grocery Challenges

To compete with the world’s e-grocers, brick-and-mortar grocery chains have been busy coming online in the past few years around the world, to provide exactly what the hybrid shopper wants: a choice of an in-store and online shopping experience that is consistent. This is where the omnichannel experience comes in for grocers to cater to all types of customers - offline, online and hybrid, maximizing grocers’ market share along each channel.

Yango Tech has emerged as a leading software solutions partner for e-grocery players in the dynamic MENA region, which brims with untapped growth opportunities. Yango Tech is working to bring these technological solutions to grocers across the region, to quickly get them up and running selling their groceries online so that they can quickly and easily offer this hybrid shopping experience to their users. 

Yango Tech combines extensive expertise in technology and business to empower grocers striving to capture significant market share in the e-commerce domain. Their mission is to embrace innovative technologies and provide businesses with a comprehensive tech stack to excel in the e-grocery market. 

Operating on a B2B SaaS model, Yango Tech enables retailers to enter the online market and open new revenue streams from e-commerce, and e-grocers to improve operational efficiency. By integrating an end-to-end solution into their operations, businesses can avoid the costs associated with maintaining non-core functions, such as IT support.

Grocers can also integrate specific modules with existing retailer systems, such as a warehouse management system supported by smart machine-learning algorithms to improve fulfillment & warehouse operations, a solution that covers full order management from the website to the client’s doorstep, or an immense data-supporting software to aid in logistics. The goal is to create the smooth flow of data, integration, and control required for successful e-grocery operations. 

Enabling E-grocery Growth in the MENA Region

Yango Tech recognized the MENA region’s potential early on. In 2022, the online grocery market in MENA reached a value of approximately $4.5 billion, and projections suggest a robust compound annual growth rate (CAGR) of ~24%, and a market reaching an estimated $25 billion by 2030. With e-commerce penetration at a mere 2-4% across the Middle East, advanced technologies serve as catalysts for further market expansion.

Having entered the UAE market in 2022, Yango Tech has already helped fuel growth for various companies. Their technologies power over 500 connected dark stores for clients like PtteM, Turkey's national post operator's e-commerce subsidiary, and nana, a leading e-grocery delivery service in Saudi Arabia. With evolving opportunities, Yango Tech addresses common issues faced in the MENA region, such as stock replenishment challenges, inventory inaccuracies, sub-optimal utilisation of last-mile delivery teams, and lack of operational transparency. 

“By implementing our Warehouse Management System, nana reduced the average number of missing items per day by 97% and its purpose-built dark store picker app decreased order preparation time by over 35% through smart in-store routing and intelligent batching,” says Max Avtukhov, Yango Tech’s CEO.

Technological solutions optimized operations, through the introduction of auto order and demand planning systems, enhanced visibility via the implementation of business dashboards with key metrics and resulted in improved business performance and success for its customers. 

“Additionally, by integrating Yango Tech's technologies, nana improved demand forecasting, eliminated expired goods, and provided comprehensive operational visibility and data-driven decision-making.” Max continued, “united with our partners, we are dedicated to empowering customers in the MENA region to redefine industry standards and revolutionize the e-grocery industry. Together, we aim to elevate the shopping experience and shape a new era in the world of online grocery shopping.” 

The New Normal Is Tech-Enabled

Post-pandemic, retailers and e-grocers that embrace this shift, invest in technology, and prioritize customer experience, will be well-positioned to thrive in the future.

“Manual inventory management leads to a lack of transparency and often results in discrepancies between reported inventory levels and actual stock availability. This results in poor customer satisfaction, particularly when orders are incomplete. Our data-driven inventory management and operations optimization solutions support demand prediction and accurate stock replenishment,” explains Max. 

Another common challenge for e-grocers lies in the suboptimal utilization of the workforce for last-mile operations. Assigning one courier per order increases costs and delivery times, undermining the promised quick delivery and order unit economics. “To combat this, our tech stack provides real-time visibility of warehouse operations and automates order processing with ML-powered software designed for warehouse staff and couriers,” Max explains.

Continuing to address solutions for last-mile delivery, Max tells us that Yango Tech’s tech stack supports various delivery options, including ultra-fast delivery, while smart routing solutions and batching algorithms optimize fuel consumption, reduce CO2 emissions, and streamline the delivery process.

With the right technological tools, e-grocery companies can manage orders, inventory, and deliveries effectively, reducing costs and increasing margins. “For instance,” Max says, “our algorithms can automatically apply discounts to products predicted to remain unsold before their expiration dates. And during periods of high demand, the system can adjust the minimum basket value or increase the delivery fee to maintain supply and demand equilibrium.” Moreover, the mentioned automatic discounts on short or close expiration dated products significantly support the decrease in food waste as well as saving on other costs included in the process of writing off expired products. 

Apart from discounts, Yango Tech can help reduce food waste by using auto-replenishment. The system predicts the amount of goods to be sold and orders accordingly. By combining these two tools businesses can achieve up to a 40% reduction in food waste.

Advice to Other Budding Entrepreneurs

Max’s tip to budding entrepreneurs is to leverage the power of data analytics any way they can. He explains, “to thrive in today's digital age, leveraging the power of data analytics is vital. By collecting and analyzing data on customer preferences and purchasing behaviour, businesses can make informed decisions regarding menu offerings, pricing strategies, and inventory management.” 

Personalizing services, providing exceptional customer care, seamless shopping experience and implementing referral programs foster strong customer engagement and loyalty. A further tip is to embrace a culture of continuous learning and improvement. This enables businesses to stay ahead of industry trends and evolving customer preferences. “In today's world everything is changing very fast, and to stay on the curve businesses need to improve constantly. Yango Tech is always working on improving products and embracing the latest tech innovations,” he says. 

So what’s next for Yango Tech? As the team continues to expand its operations across the Middle East and Turkey, it says it also aims to extend its presence to other markets, including Africa, Latin America, and Asia. Its commitment to delivering exceptional technology solutions and expertise remains at the forefront of its global expansion plans.

To read more about the future of food and the growing business of foodtech – read the full report here


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