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As the co-founder and chief executive officer of the largest e-commerce site in the Arab world, Ronaldo Mouchawar has become a leading figure in the region’s entrepreneurial circles. Billed as being the ‘Amazon of the Middle East’, Souq.com operates both as a retail site and as a marketplace for third party sellers. Launched 10 years ago as an auction site linked to the Arab internet portal Maktoob, Souq.com was spun off in 2009 as part of Jabbar Internet Group. It now features more than 600,000 products across categories including consumer electronics, fashion and household goods and attracts over 42 million visits per month. Having raised more than $150m in financing, including $75m from Naspers last year, the company now has over 2,000 employees across operations, customer service and logistics. Souq.com also emerged as the second most searched for brand in 2014 in the United Arab Emirates, according to Google. In an exclusive interview with Gulf

Business, Mouchawar discloses his views on where the regional e-commerce market is headed, the biggest challenges it faces and Souq.com’s direction.

The e-commerce market has boomed in the Middle East over the last few years. Where does it currently stand?

“In the last couple of years we have seen e-commerce really grow quite well. Overall the industry is growing at 60 per cent compared to growth of between 3 to 8 per cent in offline retail. So clearly there’s a huge growth opportunity.

“Thanks to that growth, we see that many smaller merchants who didn’t want to go on the internet or didn’t understand it in the past have now come online. I think that mindset is changing because of the mobile phone and social media. They also see other merchants and other sites advertising – and all of this fuels a circle of growth.

“Regionally, we are seeing a lot of innovation in payment, logistics and many new verticals such as baby sites, homes sites etc., hence there is a need for tailored services. We are also seeing a boom in marketplaces including some that are an extension of social media.

“Those are all great ideas and we are seeing them localise in the region.”

As the industry grows, do you see increased competition?

“E-commerce as a platform is very intensive in terms of how much you have to do off of the website – logistics, warehouses, fulfillment, speed, delivery and payments. So you have to be a patient entrepreneur if you want to get into this space. “We have been around for several years and it takes some time to build the momentum. You can’t become a success from day one. It requires quite a bit of investment and you have to be good at managing your investors and maintaining investor relationships. You need to understand their goals, what they see as potential and how you can meet that.

“In the internet industry, you always get newcomers with lots of ideas and people innovating around a problem and creating solutions. And people should innovate – there are many categories that have not been localised especially on mobile apps. “But we don’t think we are too big – we believe we have to keep growing fast. At Souq, we think it is a journey and we continue being aggressive.”

What are the biggest challenges that you face?

“We have come a long way in the last few years with the issue of payments almost solved. Multiple providers and many banks now want to work with Souq.com, so they have realised the growth in e-commerce.

“Logistics will always remain a challenge as you grow because you need to have the right supply from service providers. But that is a challenge everywhere, not just in the region.

“Our job as a platform is to make sure that customers feel happy with the product and we work hard with logistics to provide ample delivery time. Currently, many of our orders come within a day or two whereas a few years ago the timeframe was three to five days. “The advantage now is that we are not alone in the ecosystem anymore. Suppliers, brands, service providers – all of them are seeing the value that e-commerce can bring to the region in terms of market share and actual creation of demand, which is scaling the industry further.

“For us since we also operate in a region where you have so many countries, what may work in one place might not work in another. Hence it requires a lot of effort to manage scale over boundaries.

“Also, with the company scaling fast, our challenge is to ensure that people still stay connected to our culture and values. “Managing people and our talent and making them part of the journey is maybe my number one challenge and focus. We have got to keep everyone in sync and aligned with our goals and make sure that motivation is there in all our offices.”

Lastly, what are your expansion plans?

“We are focusing on adding categories and providing a better service today. We still have big markets such as Egypt and Saudi Arabia where e-commerce is going to grow very fast and we want to make sure we stay local, in the region.

“We like that affinity with the user that people here are able to use something local. Nothing makes me happier than when I’m on a plane or bus or taxi and I speak to someone who is a customer or seller on Souq – the conversation takes on a different dynamic.

“In terms of growth, the industry is growing between 40 to 60 per cent and at Souq we would like to think we could grow faster than that. ”