S.Africa e-commerce booms in lockdown

As consumers shy away from shops during the pandemic, online shopping has soared across South Africa.

Having long lagged behind much of the world in terms of e-commerce, South African retailers and delivery start-ups have now been doing a roaring trade online, with the likes of Pick n Pay, Checkers and OneDayOnly experiencing an explosion in demand.

For local entrepreneurs like Thulani Mkhabela this was a clear opportunity. He spotted the gap in the market for an online delivery app that could service marginalized areas and create jobs.

He launched Siyeza Delivery which now couriers medication, clothes, and groceries.

"We found a niche market where I can locate drivers and create an app that will allow you at your door or at your home to sit and just order food and come to you with everything. I mean right now, your competitors, your Uber, and your MrDelivery they can't even reach our townships due to the restrictions and our ways. Now that we know our people also know our routes, it's easy to alert our drivers to go to everyone, to their customers."

But this post-COVID boom is straining the capacity of even the largest retailers, leaving some customers complaining of long wait times and poor service.

Experts say factors such as fear of parcel theft, online fraud, and high mobile data costs have long hindered South African e-commerce growth.

The ability to alleviate those growing pains will dictate which companies emerge as e-commerce leaders and which will be left behind.

Global e-commerce giant Amazon does not operate in the economy of 58 million consumers -- partly because of the cost and challenges of setting up the required infrastructure, according to analysts.

And African giant Jumia only launched in South Africa this year.

According to London-based market research firm Euromonitor International, e-commerce accounted for only 1.6% of South African retail sales in 2019.

In the United States, the figure is 14.8%. Even smaller African nations like Kenya shop more online.

But a survey conducted by Visa found that 64% of consumers in South Africa bought groceries online for the first time because of the coronavirus outbreak and that 53% made their first online purchase from a pharmacy.

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