KARACHI: A local startup powered by artificial intelligence, and backed by investors in the United Arab Emirates among other countries, has formally launched a chain of retail stores in Karachi this week to revive the diminishing trend of community or “kiryana” stores in Pakistan.
With the rise of supermarkets and malls in Pakistan, community retail stores are fast diminishing in Pakistan — despite the fact that they have for decades ensured the availability of a wide range of products offered at significantly low prices in small neighborhoods. 
Ucaaz aims to bring community stores back by connecting buyers and sellers through both digital and physical means. The company, which derives its name from an ancient, pre-Islamic bazaar in Makkah that has become a tourist destination in present-day Saudi Arabia, has been financed by investors from the United States, United Arab Emirates and Pakistan.
“It’s a virtually integrated system in which all stakeholders, including distributors, retailers and small retail stores are interconnected. We will digitally manage our inventories and supply chain,” Syed Saad Shah, the founder and CEO of Ucaaz, told Arab News, saying the tech startup was “first of its kind in Pakistan.”
“We are offering solutions to the problems of small retails stores such as ordering, sales promotion and, most importantly, taxation. This is an irregular trade sector with immense economic potential, though it largely remains untaxed,” Shah said. 
“We have designed a program which will help us cut out the middleman and directly interact with manufacturers,” the CEO added. “This ensures that the prices offered by our franchises remain competitive and all necessary products are available in one’s proximity. Customers will be able to place their orders using the mobile app.”

The startup has planned to open about 120 franchises in Karachi before branching out in at least five other cities of the country. The stores will be equipped with a point of sales (POS) system offering unique support to trading activities and helping the government generate more tax.
“At present, karyana stores are not integrated with the POS system and this huge network of stores remains out of the tax net,” Shah said. “Ours is the first of its kind hybrid model of e-commerce stores which has the potential of creating a huge revenue stream for the government.”
Pakistan is already striving to reduce cash-based transactions. The central bank estimates a shift to electronic payment mechanisms can boost Pakistan’s GDP by about seven percent, create four million jobs and result in $263 billion new deposits by 2025. 
Investors that have bankrolled the startup say they were attracted by the idea of reviving small retail stores through technological innovation.
“This is a data-driven project and the Ucaaz team has made a huge achievement by providing easy solutions and making it possible to streamline inventories,” Dr. Jawad Arif, a Pakistani-American investor, told Arab News.
“It is very easy for small shop owners to keep track of their list of products, communicate with vendors and, at the same time, make profit … The system is ideal for densely populated countries like Pakistan and Indonesia, though a little bit of fine tuning may also make it suitable for the US market.”

Arif was optimistic that the company would make inroads in Turkey and Indonesia within the next three to four years: “Ucaaz plans to increase the number of stores to 500 in Pakistan before launching the initiative overseas.”
Shop owners say the idea is suitable for those who lack delivery and promotion facilities.
“On the back of this innovative solution, we only need to focus on managing sales now,” Shumail Haider, a shop owner in Karachi’s Federal B. Area, said. “Replenishing stocks is usually a major problem for small traders but supply chain management and promotion taken over by a tech startup can be a significant facilitation.”