Navigating Payment Gateways and Shopify in the Balkans - with Adin Mulaahmetovic from Power Commerce

This talk covers the challenges and opportunities in the e-commerce landscape of Southeast Europe, particularly focusing on payment gateways and platforms like Shopify. The speaker, Adin, who is the managing director at Power Commerce, shares insights based on his experiences with various brands and the complexities of the regional market. He discusses the significance of cash on delivery, the rise of social media shopping, and the struggles with e-commerce regulations in countries like Bosnia and Serbia. The presentation highlights the need for tailored solutions to cater to diverse consumer preferences across the region and introduces the potential of partnerships with companies like Monri and Shop Laza to enhance e-commerce accessibility and payment processing.

Hi everyone. Hope everyone's not too tired. Uh, do I have like a remote or something, please? Thank you. Okay, welcome everyone. Uh, I'm going to take the time today to well briefly introduce you to our company. First of all, Power Commerce and what we do. Second, I'm going to tell you a story that I've been living over the past two or three years in regards to fiscal

regulations, payment gateways, e-commerce, and so much more in Bosnia. And where we've arrived, what's to come, how it's going to go. I don't think the remote works. Okay, good. So, first of all, I want to take the time and tell you who I am and what I do. I'm Adin. the managing director at Power Commerce. Uh throughout my years of experience working with some brands such as

Billy Eyish, Fenty Beauty, PepsiCo, even in local markets here, we've also been partnering up with a lot of various companies both globally and here in the Southeast European region. Uh our main goal is to wait. What I do is I power some of the biggest brands across every facet of commerce. Oh my god, this is this is very annoying. I'm sorry. Okay, these are some of the

brands I've worked with over these past few years and as you can see it's mainly fashion brands along with some farmer brands. Uh, one of the bigger brands is Oatley as well and of course Pepsi. So uh question is navigating payment gateways and Shopify in the Balkans overcoming great market challenges. What we do I in in our line of work is generally find solutions to problems that

we can foresee and to problems that currently exist in the market. Uh what our main concern with Shopify in the Balkans was is how payment gateways are going to be available for countries such as Bosnia, for countries such as uh Serbia and countries not in the general EU ecosystem. God damn it. Okay, moving on to Shopify. It's kind of what we mainly uh do and most of

the websites that we've worked with in regards to Billy Eyish, Rihanna uh and Pepsi have been based on Shopify. Today I'm going to take the time and present something different or an alternative to this solution and I'm going to do it through a very short anecdote. So I want you to meet Stephen. Steven is a guy who has gone to the gym a couple of times but

is getting very very bored of it. So his kind of goal is to cut down on that time. He wants to be able to get out of bed immediately and start working out. Get it out his system at the beginning of the day. So he has no waiting for machines, no monthly gym fees, and can exercise in his pajamas. So what does he do? He buys a

yoga mat. He buys resistance bands. He buys dumbbells. but then never uses them. What happens is his home gym turns into a laundry rack and he ends up watching workout videos while eating snacks. Then he gains weight instead of losing it. He eventually just signs up for the gym again. So what was Steven doing at the beginning of this process? He was doing guesswork. He was thinking,

"Okay, maybe if I do this, it'll end up with the result that we want. So, let's face it, your business deserves a whole lot more than just guesswork. In Southeast Europe, e-commerce is kind of like dating. So, every country has a type. Romanians like tech gadgets, Bulgarians like good deals and trusts, and Serbians are into fast delivery and local payment options. So, this tells us that every

market has a specific need that needs to be absolutely fulfilled. These are some facts that I've pulled in throughout for these markets. One of the things that we can see is that cash is still king. Cash on delivery is a very very heavy topic within the Balkans especially in my home country in Bosnia where COOD is very very uh predominant. We can also take a look at

crossber shopping. So it's not foreign that we'll see countries in the western Balkans have a very big presence from Amazon from uh eBay and people will generally even pay uh shipping costs that are a lot lot higher just to get products from other retailers. We've also seen a very good example in Teimu coming to these markets over these past few years. One more thing that we can

see in countries such as Albania and Kosovo is that Instagram shopping, Facebook marketplace is so huge that it even outweighs websites to a very very high degree. Some businesses even don't don't look at websites anymore. They just go through Instagram and Facebook shopping. So what are kind of the main problems that we have along with some of the benefits? We don't really have a lot of e-commerce

laws implemented. I think that uh majority of these countries have a very slow process when it comes to implementing these regulations and there's really no specific framework when it comes to e-commerce. Uh along with that we want to talk about some opportunity in which we have a very very high growth rate in Europe. That is also because there's not a lot of infrastructure to begin with in

the in the e-commerce space. But if we're looking at Romania and Bulgaria, e-commerce growth rates have been over 30% yearonear, which is absolutely fantastic. If we're looking at my home country, Bosnia, it's been it's been even over 50% in some cases. But one fun fact is that we have very high abandonment rates in some Balkan countries. So around 80% of people won't even won't even complete their

checkout. So what does this tell us? We can take a very good example from a company called DM uh in which they have implemented something fascinating. They don't even uh use their cart functionality anymore to its design. They built out a shopping list because they've noticed people would go into the cart, put in stuff there, go into the shop, show it to show it to the workers

in the shop and tell them, "Hey, I want to purchase all these items." So now instead, they just have a shopping list where you can do that automatically. In order to understand the topic further, I've divided uh four key groups and what we need to focus on when we're talking about implementing payment gateways and navigating this complex structure. So what do entrepreneurs want? They want to know

how to bypass Shopify's restrictions and launch an online store. That's mainly uh that's mainly a very big uh problem in large scale businesses especially when they're coming from different platforms. Then we have developers who want to know how they can integrate a compliant payment solution which is more difficult to find as you'll see later in the presentation than it's made out to be. We have investors who

are worried about the impact of all these factors and how it's going how they can support growth. And on top of that we have opportunities to expand e-commerce accessibility and how this is actually going to be taxed, what the payments are going to look like and how it's generally going to go. So, I'm going to tell you the story over these past two years on how we've

overcome e-commerce barriers and how many partners we've actually had to include in order to provide actually a a fullyfledged solution to these markets. Shopify payments isn't supported across the board. That's the main fact that we need to know. So, Shopify payments allows for a a vast opportunity in uh just expanding your your business, getting less transaction fees, being able to scale more moderately uh and it just

it improves the ability to ship, improves logistics. Then on top of that, we want to look at uh some statistics that are generally global. So, a 1second delay in page load time can reduce conversions by 7%. And if a site takes more than 3 seconds to load, 53% of users will bounce. So then that posed a question to me uh how many of how many websites actually

in this southeast European region have a bounce rate h have a loading time that takes more than 3 seconds? And I'll tell you the statistic. On average, it takes 6.7 seconds within the Southeast European region for a website to load. So we're immediately losing out on a very very big market gap that can be filled by just increasing quality and having strategic partners in place to build

this infrastructure up. Uh one more fact that I wanted to present while we're while we're in Bulgaria is that Bulgaria has the lowest rate uh of internet purchases in the EU on average. So that's one very shocking fact considering that there are market like that there are markets who are that are much smaller than Bulgaria but still Bulgaria has a very big presence of cash on delivery.

So what are the key pain points that lead to these statistics being the way they are? We have regulatory and financial barriers. We have temporary workarounds. And I'll tell you uh uh I'll tell you briefly on just some of the stuff we've encountered over these past years. uh we would uh go to an initial uh briefing with the company and they would tell us oh we have

an ERP system on the back of that we have a middleware that processes data on top of that we have a front end and it's a website that's fully functioning when digging a little bit deeper you can see that they implemented one ERP system to manage orders one ERP system to manage accounts one ERP system to manage financial and uh then on top of that there are

two middleares who funnel all of that into one single big ecosystem that just breaks all the time. On top of that, we have government advocacy and industry collaboration which is never easy and it takes a lot of lobbying from a lot of different parties in order to get to the end result that we want and at the end we have the breakthrough solution that this market has

been looking for. So in order to get acquainted uh this market is very much starved of e e-commerce solutions uh as a whole that have proper backing from all postal services, proper backing from all payment integrators and proper outreach for global markets. This is the rough timeline of what these past few years have been like for uh for me and where it started off. So in 2022,

we had initial conversations with Monri on implementation. Moni is also a very big payment provider in in the Balkan region. Uh so we first met and partnered up in 2022 and we immediately identified that we could work together to bring this market further. We were trying to get a new payment gateway approved for Shopify and that sounds uh very easy compared to how much hassle we've gone

through. uh we worked with Shopify for the past uh for more than five years and a at this point it was just very difficult to get in touch even through partners even through people we worked with extensively on so many projects. We just couldn't get anyone to budge and give us room to be able to implement a proper solution. Then we aligned we were trying to align

with government institutions on new laws and implementations and that also didn't lead anywhere. there are just bigger players in uh in in this entire story and uh Shopify just doesn't want to go into some markets because of payments and because of fiscal regulations that don't suit their business needs. So what we had to do this year is actually just fully go back to the drawing board. So

after putting two years into this project and after putting in two years in constant conversation with uh I think that they there have been over 50 meetings both with government institutions and with partners uh that have been very very extensive a lot of documentation built. we had to fully go back to the drawing board and we found one partner which is Shop Laza that we want to

kind of uh put into the spotlight now as an all-encompassing solution to this problem along with us and Moni. So I want to also talk about just who Sha Plaza is and how they support how they support current merchants. majority of their market right now is uh based in China, but they work in 180 plus territories. They have 200 plus apps and they have over half a

million stores online. I don't know if you've heard of them up until this point, but believe me, within a year, uh it's going to be a different story. So, looking at just the base model on how this this was structured. So, we as Power Commerce are handling app and store development. Shop Plaza is providing us with a home or with an e-commerce platform while Moni is handling

the fully the payment processing and the local distribution. So this allows us to create an ecosystem where merchants from both the Western Balkans and generally the Southeast European region can absolutely thrive. Okay, so I have I have a couple of more minutes. Uh if you want to uh look at something cool, I have a QR code here as well. Uh we also have a digital map of

the entirety of the conference with all the booths that you can check out. Uh but what I want to what I want to kind of say off topic is that it's been an absolute privilege to be working with both Mon and Shop Plaza in this market for uh for this time. It's been very difficult to get merchants to be on board w with with what we're trying

to push and only this year have we actually gotten tangible results with uh companies that are identifying potential and it's growing at a very very rapid pace. So I would say get on board. It's absolutely worth it. Thank you so much. [Applause]