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Red Star Express Is Extending Its Winning With E-Commerce Launch

Logistics and supply chain group, Red Star Express (RSE), has been an African successful business story but they are not resting on their achievements yet. Recently they took the e-commerce market by storm with the launch of Red Star E-commerce platform. Moov Logistics News (MLN) sought to find out how the company is creating such a big buzz in the market in a very short time after launch. We tracked one of the architects of RSE E-commerce, Mr Jayson Oyarekhua, who is the Chief Operating Officer of Red Star Technology Service and he spoke exclusively to our correspondent Casandra Aniemeke. Excerpts:


Jayson Oyarekhua, Chief Operating Officer for Red Star Technology Service

MLN: Can we meet you, Sir?

Oyarekhua: My Name is Jayson Oyarekhua, Chief Operating Officer for Red Star Technology Services, a subsidiary of Red Star Express. Red Star Technology Services was set up to enhance and simplify business processes. I’m basically into corporate leadership and part of the services we offer are e-commerce, order fulfilment, electronic archiving and generally enterprise solutions.

MLN: Can you tell us about your RSE E-commerce platform and why RSE decided to go into E-commerce considering the fact that many companies are already in it?

Oyarekhua: Well Technology today cannot be ignored, that’s one thing. It has come to set the stage and after Jeff Bezos, the CEO of Amazon revolutionized the way buying and selling transactions operate. People just realized that convenience was the order of the day. And so sincerely Red Star Express is not doing anything different, we are doing what we know how to do best, which is pickup and delivery, order fulfilment and just ensuring that end-users get what they desire, which is Pay on Delivery, visibility, prepaid options, last mile deliveries and accessibility.

MLN: What differentiates RSE e-commerce from other e-commerce platforms?

Oyarekhua: Simply put, I will say our people, our passion to create value, and our capacity to deliver round Nigeria and on promises.

MLN: What are the problems the RSE E-commerce platform intends to solve and what are the solutions?

Oyarekhua: The E-commerce industry is plagued with a lot of issues which vary from speed to the market, feasibility, financial reconciliation and accessibility, and that is what we have gathered over these past twenty-five years of being in business we have been able to increase our capacity around Nigeria. We have over 160 offices around Nigeria and that gives us a lot of accessibility especially to the end users.

We have set up a logistics management tools which enables us to carry out transactions, give visibility to customers and also financial reconciliation, which is a major bane in the industry. There are a lot of Pay on Deliveries orders…..let me give you an example….in the industry, you have ‘Pay on Delivery’ and you have ‘Pre-paid’. ‘Pay on delivery’ covers 75% of the Market space. This happens because of distrust, because of fraud and a whole lot of other things and we realize that if we don’t play in that space we would be nowhere, what’s the point and that’s why we came up with the logistics management tools, which is also shared parallel with the customer as they are able to see their total transactions in real-time.

MLN: when you say Logistics Management tools can you explain what you mean by that?

Oyarekhua: It is an application that gives the customers the visibility on all their transactions. They are able to create and upload those orders, which gives us notifications and then we go ahead to do pickups and they see their transactions move from point to point…

MLN: They can track?

Oyarekhua: Yes they can track and they receive unsolicited messages as per the location of their packages until their delivery done.

MLN: How do they make payment? Is it payment on delivery?

Oyarekhua: There are various ways. First, we have a wallet system which helps you make a refundable deposit. Refundable, so that when you don’t use the money or you don’t need the service anymore you get refunded. That means you make a deposit into our account and every transaction is drawn from that deposit. Then upon 90% depletion, you will be required to top up. You can also pay at point of shipping and lastly will be the “Pay on Delivery” option, where we collect money for product and shipping on behalf of the customer and remit to the customer.

MLN: So what you are saying now is that the wallet has to be funded and what’s the minimum?

Oyarekhua: The wallet has to be funded because the issue is that e-commerce is a cash-based. Why hold my money down, for example, you know what they call Time Value of Money, it begins to depreciate over time. And the minimum is N20,000.00 because we are dealing with SMEs. Some people don’t ship at the same rate as others. While some might ship twice a week, others might ship once a week. Someone else might be shipping in 100s in a day, so it all depends on the merchant, our customer.

MLN: How would you rate your e-commerce service amongst others?

Oyarekhua: Well I think we are doing our best to ensure we give value to customers and giving them value for money and ensuring that staff are motivated to perform exceedingly above expectations. However, I can tell you that we are not in a business of comparing ourselves with the competition. We pride ourselves based on who we are. And who are we? We are just simply delivering service, Absolutely, Positively, Whatever it takes.

MLN: Can you explain the RSE e-commerce insurance policy, how it works?

Oyarekhua: RSE has a free Goods in Transit Insurance up to a 100,000.00. However, we charge 1% of the package value if above N100,000.00 as insurance cover. If you have parcels that are valued within a N100,000.00 each, the Insurance cover is free. That means if anything happens to that package Red Star pays you immediately. However, for packages that are valued above a N100,000.00, we charge 1% of that value as the premium for Insurance. This, however, is optional because you can also take your own insurance.

MLN: When you say you pay up to N100,000.00 do you mean the total value of the shipment?

Oyarekhua: Yes the total value of the shipment – if the shipment is worth a N100,000.00 Red Star pays N100,000.00.

MLN: Has there been any incident of such?

Oyarekhua: Hmmm. Yes. Probably one because you know in this our business of movement of packages from one place to another, there are a lot of issues happening. From bad roads to mishaps, accidents. Although those are not the issues, the most important thing is that we have put checks in places to take care of these issues when they happen.

MLN: What parameters do you use to ensure you are not paying for a damaged shipment that is not RSE’s fault?

Oyarekhua: Well first of all when a package is received, it is received in good condition and that is why it is been signed for because at every touch point there must be an accountability level. Once the package is being considered as damaged you will definitely see that there’s been a damage to it. However, we will not take that of a VCR (Video Recorder) in a sealed condition, by the time it gets to a consumer he tries to play it and realizes it’s not working RSE will not be liable because we didn’t test it. We took it as it was and delivered as you gave it to us. But if the carton is damaged or the item is broken while in transit, of course, such things can happen and RSE will be liable and we will pay without asking for explanations.

MLN: You have a wide network that covers over 10,000 communities in Nigeria, how does RSE meet up with deliveries?

Oyarekhua: Well excitingly, just like you said we have a wide network, which again is part of our strength. However what we do is just to focus on commitment, timing, and efficiency. Those are the things we focus on because we already have the wide network.

MLN: What is the purpose of the RSE Black Friday Festive Season Promo, and are you meeting your targets?

Oyarekhua: Yes we are meeting our target, depending on what you think the target is. However, it’s a period to give back to our merchants, to give back to our loyal customers and that’s why we are giving 20% off and charging nothing for return items. We also want to create a buzz so that people also know what we do. You know as popular as Panadol is they still advertise somehow, so people need to understand what we do and try out our services.

MLN: Was it worth it?

Oyarekhua: Yes, it is worth it. The most important thing to us is the satisfaction you get from the faces of your customers. My customers are satisfied, they are happy because it takes a lot to give away things on sales. Now how are they going to get things back? We cannot be charging them premium anymore for doing that. The fact that I’m giving them a discount put them in a comfort zone. Again don’t forget that people who signed up with us within this period get 20% discount. It’s an interesting thing. We actually cannot wait to extend the Christmas promo into the New Year, up to January 15th.

MLN: Well I think the response must be so encouraging since you are thinking of extending it till next year. And thank you very much for taking out time out of your busy schedule to have this conversation with us.

Oyarekhua: Thank you.

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