This is part 3 of a 3-part series.
“Some companies still keep their procurement documents in containers,” says Marvin Tumbo, former digital director of Kenyan President Uhuru Kenyatta and founder of Scale, a procurement management system in Kenya. “One company told us that the documents for a single tender were so large that they filled an entire container on their own.”
Scale offers companies a platform to more conveniently store all business documents required during the bidding process; digital. The platform also gives suppliers access to opportunities as well as a way for them to digitally compose their RFP responses to eliminate the cost and chaos of manual paperwork.
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Tumbo founded Scale to address the “manual, broken, and obsolete” systems used by suppliers and private and public procurement agencies in Kenya.
Scale Supply, Scale’s introductory product, offers monthly bundles between $ 9 and $ 42 and currently has more than 5,000 registered suppliers, 55% of whom are women-owned companies. Scale has published 15,000 tenders since it was launched in late 2020.
“We hope to be able to tender millions in the next few years,” said Tumbo The Africa Reportoutlining Scale’s plans to create a continental marketplace. As the company continues to bring on new suppliers, it stands ready to bring new products to market for the public sector and private companies as well.
âProcurement companies and blue chip companies themselves don’t use digital systems,â says Tumbo. âSome companies still use email to post and manage RFQs,â he adds.
Not to mention Container for storing papers. Scale Procure, scheduled to roll out in January 2022, will provide procurement companies with Scale’s digital tools to manage the various aspects of the procurement process.
Perhaps the biggest innovation that Scale is proposing in the East African procurement ecosystem is Scale Finance, where a partnership with local credit institutions will provide capital and collateral for award-winning SMEs. Almost 98% of Scale’s suppliers are SMEs.
âBanks currently Have limited confidence in Kenyan treaties and so the risk threshold for them is high, âsays Tumbo. “Our service will help you to carry out your due diligence.”
With Scale Finance, banks have one-tap access to a company’s tax records, performance records and credit ratings, as well as a range of other compliance, financial and administrative documents. The idea is to strengthen supply chain funding.
âWe have to be creative when it comes to financing SMEs,â adds Tumbo, who leads the six-person team at Scale’s Nairobi office. Scale Finance addresses this lack of institutional funding, one of the “critical pain points” for SMEs, says Tumbo.
Small companies often win tenders, but then cannot afford to implement the project for the customer. SMEs have often waited three years to win their first award.
“There is a $ 19 billion funding gap in Kenya for SMEs,” said Tumbo. While 30% of all public expenditure in Kenya is legally earmarked for women, young people and the disabled in Kenya’s public procurement budgets, this goal has still not been achieved.
Tumbo, 37, says Scale’s strategy was shaped in part by his own experience. “I worked as the digital director for President Uhuru Kenyatta from 2011 to 2013,” said Tumbo from Nakuru The Africa Report.
When he moved on, he founded Socialight Media and decided to apply for tenders. He wanted to register for a certificate in 2013 and found that the entire process was still manual. Socialight Media set up the first digital certification system for suppliers in Kenya: the Access to Government Procurement Opportunities portal. According to Tumbo, AGPO has more than 200,000 registered users.
Now Scale would like to expand its services to Uganda and Tanzania. However, the Scale founder prefers to see the African continent as a unified procurement market.
“I am independent of the jurisprudence,” says Tumbo. âWith the data that we generate, we can gain certain insights from it. We’ll be able to see what the patterns are in terms of trading. In terms of supply and demand. And from there we can map who is selling what from where. Then a user might ask: If goods are being sold from South Africa, would it be better to deal with a company in Zimbabwe because they are cheaper? Instead of importing from Germany or South Africa, you might get something from South Africa for the same price, âspeculates Tumbo. Time to digitize these containers.