Mini Exchange makes big impression

Sarah Appleton explains why she devised kids’ clothing website Mini Exchange, and how she hopes to help parents solve a long-standing problem
By Neil King
Wed 05 Mar 2014 11:09 AM

As any parent will be tell you, children grow out of clothes at an alarming rate.

In the UAE, that often means that children grow out of designer clothes at an alarming rate, leaving potentially thousands upon thousands of high end kidswear items tucked away in wardrobes, or – worse – consigned to the rubbish heap.

On the other side of the coin, there are large numbers of mothers and fathers who look to dress their children in fashionable threads, only to be put off by the high prices.

Identifying these two issues, British entrepreneur Sarah Appleton devised a way to satisfy both sets of parents, launching internet business Mini Exchange (www.miniexchange.com) at the start of 2014.

The website allows users to create accounts, through which they can sell their unwanted items, leaving customers to pick up quality clothing at bargain prices, and thus solving the perennial problem of growth spurts, excess attire, and expensive shopping trips.

Accepting garments from designer labels such as Christian Dior, Ralph Lauren, and Dolce & Gabbana, as well as high street brands such as Gap, Mamas & Papas, and United Colors of Benetton, Mini Exchange has already experienced a huge uptake in its services, attracting about 200 sellers within the first four months.

With a background in corporate finance, Appleton’s move into kids’ clothing might not seem like an obvious one.

But having moved to Dubai two and a half years ago with her then employer Deloitte, it wasn’t long before she was bitten by the entrepreneurial bug, leading her to think of her next steps.

“At Deloitte I was working with all these investors and their companies. I worked with every type of business, and I wanted to do what they were doing.

“I’m from a big family, and we ran an ebay business while I was in university - buying and selling clothes. It paid for university and gave me good experience in that field.

It was that experience which led her to examine what gaps in the market she could fill, and how she could start her own business.

“Ebay isn’t in Dubai, so people use things like Dubizzle. But you don’t always know what you’re going to get when you agree to buy it - you don’t know that quality, and if you’re a seller you don’t know if the buyer is even going to turn up, let alone pay the money.

“In the US and Europe they have similar things to Mini Exchange, to give people a different way of doing things, but there was nothing out here, so I decided to go for it.

The mechanics of the site are surprisingly simple, with two main sections - the buyers’ side and the sellers’ side.

Appleton says: “The buyers’ side is a normal purchase site. You see all the clothing there, which is all discounted, and the price drops every eight weeks by 25 percent. You get notifications for that. And you can follow sellers and see when new items are added by them.”

The sellers’ side has a much more to it, giving you all the tools you need to help organise your page.

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“You set up your account, list items, and press summit,” Appleton continues. “You get a reference number, and get a phone call the next day from Aramex. Our systems integrates fully with them, so the order logs with them and they call you to arrange a time for them to collect, and then it comes back to us with the reference number.

“When we get the clothes, you get an email where you can approve the prices we’ve set. If you don’t agree with the price you can reject it. You have the option to have the items sent back to you, or gift it to one of the organisations we support.

“When an item is sold you get the information in an email. You get 50 percent of the sale price - that money can be spent on the site, transferred into a Paypal account, sent to you in a cheque if over AED1,000, or gifted to one of the charity organisations we work with.”

Good causes is a theme that runs through other parts of the Mini Exchange website, with Mini Groups offering a platform for fundraising.

Appleton explains: “If you’re doing something for a personal cause, or raising money, you can create your Mini Group. You just choose a group name, your target amount, end date, and so on, and you’re ready to go.”

According to Appleton, the gifting aspect of Mini Exchange has been an important part of the concept from the very early stages.

She says: “People are rich here and so people aren’t always interested in getting money back, so we had to think of something else.

“The community aspect is a way to help people engage with the site - suddenly you’re able to get a feel-good factor from helping somebody else.”

The company supports three child-focussed good causes - START, The Little Wings Foundation, and Action Care - which all help young people in different ways.

“People are very generous here,” continues Appleton.  “But a lot of the time people don’t know how to support the charities and the good causes - there’s not always easy access to helping them.

“We’re trying to bring it online. It’s not really done that way here yet, so that’s how we’re trying to change things.”

The importance of the region’s digital development is of paramount importance to start-ups such as Mini Exchange, which often rely on their technology to do the work that would otherwise have to be done by paid staff.

“What we’re doing is a mass business,” says Appleton. “Small numbers of items won’t work. It needs to be built on scale, so the process has to be automated.

“Whether it’s the ease of uploading items, finding product, or whatever, it all has to be quick and easy. It’s important it we’re going to have a lot of people on the site without using a lot of labour.”

As such, the current state of the region’s internet can be both frustrating, and promising.

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Appleton continues: “The region isn’t fully online yet. It’s good to be here early, as the progress will come quickly, but we’re several years behind the UK, which can be difficult.

“People still like going into shops and touching the items. And people still prefer to pay cash a lot of the time, although they are feeling more comfortable with it now. More and more shops are going online, and that will really start to change things in this region.

One of the difficulties of creating a good user experience in the GCC is finding a good - and affordable - payment gateway.

Essential to any online business, the gateway options in the GCC are often cited as being limited and expensive, leading many businesses to pay above what they believe is a fair price for a product which does not enjoy good levels of trust among customers.

Admitting that she “went into this business barely even knowing what a payment gateway was”, Appleton believes there current options on the market are soon to receive a rude awakening from foreign competitors.

“I thought there must be loads out there to choose from and that it would be really easy,” she says. “I was wrong.

“There are three providers in the region and they are all fairly expensive to use. They require huge security deposits, and are very risk averse.

“It was especially hard for us because of our ‘good causes’ element. It’s fine if you have a shop selling a book or a jumper - these are simple things for them to dead with - but the moment they see something where you’re raising money, they don’t want anything to do with it.

“We went with Checkout.com, which has recently arrived in Dubai, and it’s great. They weren’t so risk averse, which made the whole thing easier, and they were much easier to work with.

“I’m sure they will do well because so many people here are frustrated with the current payment gateways. It’s a real minefield. When the market opens up to more gateway providers from overseas I think the existing ones will really struggle to cope.”

One of the major upsides of the region according to Appleton, however, is entrepreneurial community.

She is fast to praise to collaborative spirit that pervades the emirate, saying: “People are so willing to help in Dubai.

“In the UK if you have a problem or a question, nobody will help you. Here, people are so willing in every aspect to help - they always have time to go for a coffee with you, which is really amazing.

“I’ve probably added more numbers to my phone book in the last six months than in the last four years with Deloitte.

“It’s busy, it’s hectic, but it’s brilliant.”

Hectic and brilliant things may be, but that doesn’t mean Appleton isn’t thinking ahead.

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Dubai and the region as a whole is a starting point for the entrepreneur, who plans to use her knowledge of the British market to good effect.

“Our aim is to first target this market, and then take it to the UK,” she says. “There are similar things in the UK but I’ve seen nothing that caters just for kids clothes. Some focus on women’s clothes - or clothes generally - and then have a section for kids clothes.

“It means we have a lot of aspects they don’t have.”

She also believes the UK would provide Mini Exchange with a different type of customer, adding: “In the UK people are much more happy to buy second hand, and are also much more familiar with buying online. Here people want new items. They want the tags on”

And as difficult as it may sound to receive substantial amounts of clothing with the tags still on, Appleton explains that there is another development which is making this possible.

She says: “We’ve actually been approached by - and have approached - some boutiques to work with them. So they would have their own seller’s account where they can sell their stock.

“That kind of thing didn’t even cross our minds when we were building the business plan, but it’s a great addition to the model.

“If you have a brand, you can sell to us, exactly like any other seller. It makes perfect sense for them because we do everything - we collect it all, they can use our warehouse instead of theirs, and they get paid to get rid of their unsold stock, or last season’s items. It’s win-win!”

Speaking with Appleton only four weeks since launching, she revealed that Mini Exchange already had seven boutiques and between 150-200 people submitting items to the site.

“These are huge numbers in such a short space of time,” she says. “And it’s all good quality stuff. We’ve kept about 80 percent of it, which is brilliant all round.

“People buy a lot of clothes in Dubai, and they can’t easily take things back to the shops. Plus, people are very generous with baby showers and things like that, so there’s a quick turnover of nearly new clothes.”

Mini by name, but certainly not by nature, Appleton is understandably thrilled by the immediate response to the business, and is excited by its potential.

She concludes by saying: “I really believe we’ve got something here that helps people on every side of the exchange.

“We’ve only just begun, but it’s been a great start and I can’t wait to see how far it can go.”

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