Online B2B fish market is dead, long live the B2B marketplace!
This story is not about Yorso — an online B2B marketplace for fish and seafood wholesales, the project I spent almost 4 years of my life.
The story is about a real market and its attitude to possible transformation trend with blockchain and digital revolution in old-fashioned industries. This way tends to be more efficient with less number of intermediaries, opened borders, transparency, sustainable fishing and lower transaction costs. Although advantages of such revolution seem obvious for more and more companies “in person” — as a “mass” industry is still reluctant to online solutions such as Yorso or any other.
On 24–26 April I visited the biggest fish and seafood world exhibition in Brussels — https://www.seafoodexpo.com/global/ — and tried to get answer for this simple question: “Why do companies still not trade online?”.
This is one of the old-fashioned industries that is stable and has almost not changed during last 20–30 years: most companies know each other, market is slowly growing by 3–5% per year, no major players arrive.
Even though market is really huge (in the 2017 turnover in Russia was about $10 bln., in China — ~$64 bln., in Europe — ~$50 bln.), it works completely offline: only 0.7% of the whole turnover was sold online! The disproportion is large but four years ago — when we started Yorso — the situation was even worse and online sales were about 0%! During last two years several major players such as GFresh by Alibaba group in China and Procsea in France have appeared. According to the Chinese analytics, the online sales in B2Bfish and seafood market will grow by 100–300% in the next three years.
Yorso also has launched with several companies importing from Ecuador, Morocco, Mauritania, China and Thailand into Russian market. Since now we are ready to expand to Europe and for this reason Brussels was the right choice to start contacting local companies: thousands of fisheries, processors and distributors were accessible in one place during three exhibition days.
The very first contacts were awful: as far as company representatives heard about “online B2B solution for fish and seafood industry” they became scared and looked at me as if I had two heads and six arms. That is why from the very beginning I decided not to tell anything about the solution but rather understand the problem of not taking part in digital revolution deeper.
Finally I have talked to almost each company (and collected about 500+ contacts), challenging them on why they don’t sell online and what they think about it.
The “corridor survey” divided companies into three parts:
1. “Didn’t think about it: we get used to make cold calls and write emails”. This group is potentially ready to try new approaches but we must show them what advantages they get from doing business online: additional profitability, outreaching new clients, more transparency on pricing, more trust to first contracts based on internal transparent rating system;
2. “It is impossible! We must know each company face-to-face!”. Very reluctant group of companies who doesn’t believe in B2B online sales at all. The most funniest thing is they can’t explain “why?” and this question makes them confused. When I asked directly if they knew ALL their clients in person — in most cases the answer was “No” which ruined their attitude and made them think deeply about the future of the fish and seafood business;
3. “Cool idea, guys! In 5 years we all will do it! Please rock the market!”. Even if they told so — they don’t use online sales or have some bad experience with Alibaba-like services which are not marketplaces but just the advertisement boards (in Yorso we automate everything what can be possibly automated: marketing, sales, purchases, logistics, document exchange and communication between different departments).
I met only one company who was extremely open to start working right away — Frime. Its CEO — Salvador Ramon — was very kind to be our first partner on the European market!
The next step is very simple: I agreed with everyone whom I spoke with to conduct a full marketing survey on understanding industry fears and make deeper report with precise answers without emotions.
Short and simple survey is available here for everyone.
Though market is reluctant but talks showed that in most cases companies just don’t know about options they have. Nevertheless business owners understand that online is more efficient and will definitely move there soon.
My job with Yorso team is to outreach every potential client: since now we have all the resources, strong world-known fish industry partnership, acknowledge from the IT industry and new partners regarding sales and PR support too: it’s time to stop being just a potentially interesting startup and team.
Many bad things are in the past especially the VC refusal of our idea but now we are in a strong position and we are ready to rock the online B2B fish and seafood industry!
Stay tuned!
