Retailers and small, medium-sized businesses (SMBs) have arguably seen better days. A consistent trend of SMBs shuttering amid a dry up in customer demand, brought on by COVID-19 and exacerbated by rampant inflation and the volatility of the economy has resulted in a changing landscape for retail businesses. In Asia, Peeba, an innovative wholesale platform announcing $4.2M in seed funding led by Headline Asia, is offering a lifeline to independent, SMB retailers with a unique business model.
Peeba uses a proprietary machine learning algorithm, plus hand-curation, to list on-trend goods or products that have a higher probability of selling. But what stands out about Peeba is its unprecedented "sell now, pay later" option for accredited retailers. In other words, independent retailers can reduce inventory risk by ordering products from the platform and return unsold goods (in original condition) within 60 days. And all this is without any questions asked.
With pandemic restrictions shuttering many offline trade shows and in-person sales opportunities, Peeba offers a viable alternative. Think of it as an all-in-one platform for not only sourcing inventory, but also for discovering best-selling products. With 25,000 retailers and more than 100,000 products listed on the platform, Peeba algorithmically reduces the guess work with recommendation for brands that have a strong chance to sell-through. More significantly, retailers sourcing products through Peeba also enjoy the benefit of levelling the playing field, as they'd otherwise have a lower bargaining power to not only connect with, but also sell trendsetting brands. In fact, currently Peeba's more notable retail clients include DFS Singapore, Slowood in Hong Kong, and Marais in Taiwan.
"Our mission is to transform how independent retailers discover and connect with unique brands and bring Asia's B2B wholesale retail supply chain into the modern era in the process," explained Jacky Lai, CEO of Peeba. "Peeba's major value-add is how we reduce inventory risk for retailers, through our 60-day returns policy and "sell first, pay later" model. That allows retailers to quickly adjust to post-pandemic realities with greater confidence."
To ensure favorable payment terms under its "sell first, pay later" option for retailers, there's a berth of technology and financial instruments under the hood that makes this possible. Retailers applying for this payment term are subject to an automated in-house credit assessment, designed by Peeba. Furthermore, Peeba is also revealing that they've partnered with Choco Up, a financing service provider, to secure a US$10M funding facility â in other words an insurance of sorts â to ensure that Peeba can support favorable payment terms for its retailers, without risk to its own bottom line.
On the other end of the spectrum, brands seeking to sell its wares on Peeba stand to equally benefit. Thanks to 1,500 brands on the platform, Peeba divulged that it's able to offer cross border shipping at a reduced cost. "We automate the negotiation and client management process and streamline logistics and shipping by pooling orders. All this contributes to improving operational efficiency and lowering costs for all parties," said Kevin Cho, co-founder of Peeba. Brands with global ambitions, often will seize this chance to A/B test the demand for its products in the APAC market. And considering the fragmented and complex nature of the different local tastes and logistical barriers of each market, brands can sell its products at comparatively minimal cost compared to other offline and even online retail channels. Through Peeba, brands are able to save on the cost of research and localization, while also enjoying reduced logistics fees. In fact, a couple of notable brands Peeba has on its platform include Memebox and Leaders Cosmetics.
With US$4.2M in funding, Peeba revealed in a statement that it will "deepen its localization efforts across 11 APAC countries," including Hong Kong, Singapore, South Korea and more. Peeba also plans to expand its headcount to offer more local support and make improvements to its proprietary technology including its credit assessment algorithm and inventory recommendation engine.
"Peeba is bringing about the next stage of global retail innovation. The platform brings both emerging and traditional brands to the world of local retail in Asia. We are excited to become Peeba's partner to help expand their reach into more markets in Asia," said Akio Tanaka, partner & co-founder at Headline VC.