CEO Luther Lawoyin said he founded his fourth startup shortly after getting married, and his wife started tracking their joint expenses and noticing how much they spent on groceries.
Speaking to CNBC, making It by phone, Lawoyin said he couldn't find and get the exact point; because it wasn't something he had consciously followed previously. However, after doing some research, Lawoyin said he discovered that the overspend was partly due to the inefficiencies of the healthy meal supply chain in Nigeria, where he lives, and Africa.
This inefficiency is “mainly due to the outdated and dilapidated infrastructure that plagues the continent,” he mentioned.
Headquartered primarily in the Nigerian city of Lagos, the online store connects directly with farmers, manufacturers and wholesalers, allowing people to buy bulk groceries at “big discounts”.
Lawoyin defines that the loss of integration between people in the distribution chain, means that “farmers do not have statistics on what the market wants”.
“Rural-to-city logistics teams have no established statistics for transporting goods, which forces intermediaries to act at will without knowing how to intelligently connect all level,” he added. As a result, Lawoyin said the abandoned shopper also “didn't know” where the food he bought came from or who grew it.
“Overall, the loss of data, statistics and collaboration could make this food price chain much greener than it is now,” he said.
To make their personal grocery shopping cheaper, Lawoyin and his wife, Mosunmola, decided to team up with friends to buy healthy meals in bulk faster from manufacturers. Thereupon, the idea “Principally” was born.
One of the biggest directives that Lawoyin says he discovered while growing his personal business is that “you need a lot of courage”.
“There can be difficult situations every day, and you also have to face them to move forward,” he continued. “There is no possibility to replace hard work with something else, and you also have to perform the task to get your vision.”
“The Classic Chicken and Egg Problem”
A report by the United Nations World Food Program, published in October, said the coronavirus pandemic “has reduced incomes, exacerbated poverty, disrupted regional trade, cross border supply and pastoral activities, and high food prices in the Sahel (Burkina Faso, Chad, Niger, and Nigeria) and some coastal countries (Sierra Leone and Liberia).
World Bank data shows Nigeria`s gross domestic product is expected to shrink 3.2% in 2020, compared with an estimated 2.2% growth in 2019. But the price index shows inflation is expected to have picked up. 13.8% in 2020 from 11.4% in 2019.
Laloyin officially launched Pricepally in November 2019, just before the start of the pandemic. Lavoine started an online store which composed of branded goods with his former company, Lucy. First, he was supported by business angels and institutional investors.
In addition, in August, Pricepally received a portion of the Lagos Government's Innovation Grant to share 100 million Nigerian nairas (US $ 244,185) with 22 other tech startups.
We had the money to get the business on track, but there were challenges in getting Pricepally started. Lawoyin cited the concurrency of demand and the safety of supply as a specific example.
“The question of classic chicken or the egg is very cumbersome and rewarding. Building a system that guarantees both supply and demand in a cluttered environment is a challenge,” he said. In addition, trying to provide a solution to the high food prices is a prominent goal.
Lagos, Lawoyin has expanded Pricepally to other cities in both Nigeria and even Africa, replacing inefficient systems across the continent. We hope to be able to develop innovative alternatives with the help of Technology Transfer and Exchange Network (D8tten).
