Awok: Understanding the Reasons behind the Startup’s Failure
Awok, one of the largest e-commerce platforms in Dubai, has stopped work.
Founded in 2013 by Ulugbek Yuldashev, Awok received the largest investment amount in the region. It offered around 70,000 different products at affordable prices in the United Arab Emirates and Saudi Arabia and employed more than 700 employees.
While the e-commerce sector is booming worldwide and in the Middle East, particularly after the Covid-19 outbreak, Yuldashev announced that the failure was due to the pandemic.
What are the real reasons behind Awok’s failure?
- Poor decisions
Each company should study its decisions well before taking them. Decisions are supposed to be the result of solitary or collective reflection. This is why weekly management meetings and team conferences are a must to clarify all ambiguous points.
It is always recommended, especially in the case of a startup, to notify the team of management decisions. Besides the right to access the information, employees will be motivated and understand the purpose of their job.
This was not the case with Awok. Employees blamed the company’s leadership for failure. They consider that the management took excessive risks and wasted funds without well-established plans.
- Failure to respond to users’ messages
Communication with customers makes it possible to specify their choices and keep a high client retention rate.
Awok’s client performance was unsatisfactory. Many customers complained after getting their products, simply because no one responded to their requests. What’s even more shocking is that many customers paid for products they did not receive.
For example, a lady ordered a series of products she paid for but did not receive. She contacted Awok and discovered that the company kept her money without delivering her order. Such behavior made this woman and many other customers lose their trust and confidence in Awok and leave bad online reviews: “My order was auto-canceled on July 4, but my money has not been refunded despite numerous calls and follow-ups until now. Please refund my money”.
- Team failure
As an entrepreneur, you should always care about your team and support them to deliver better results.
Salary is an essential element that encourages to work better.
Awok’s employees were not paid and kept working without remuneration for several months, while the co-founders took their full salaries. Certain employees also claim that they left without receiving their end of service benefits.