E-commerce and delivery companies have ramped up resources to ensure customers get their Christmas goods on time as the volume of orders soars.
Since Black Friday in November, there has been a spike in online shopping as customers rush to take advantage of discounts on a variety of items ranging from food, clothes and household goods to toys and electronics. E-commerce has seen rapid growth over the past few years, fuelled by the Covid pandemic.
Although the industry is still in its infant stages, it is revved up for exponential growth as e-commerce, the key driver of the delivery industry, is projected to double to R400bn by 2025, with the number of people buying online expected to reach about 40-million by 2027.
Craig Pitchers, CEO of The Courier Guy, said there has been good growth in the e-commerce space, with an estimated 30% increase in terms of volumes year on year.
Some of the growth was driven by Chinese retailers Shein and Temu, which have gained strong popularity in South Africa in recent years.
Pitchers said: “We generally see much larger volumes starting at the beginning of November running right through to Christmas. The extended Black Friday period (basically the whole of November now — not just a single day) plays a big part in this.”
To plan for the festive season’s high demand, Pitchers said The Courier Guy analysed historical trends and consulted its clients.
“By doing this we can scale accordingly and add resources where necessary, thereby ensuring optimal service levels during this very busy time,” he said.
We generally see much larger volumes starting at the beginning of November running right through to Christmas
— Craig Pitchers, The Courier Guy
At Bash, TFG’s e-commerce platform that houses all the retailers’ brands, co-CEO Claude Hanan said the company had “significantly expanded capacity across all operational areas” — including the customer support team, delivery service, and at its Riverfields distribution centre.
“We also strengthened partnerships with our stores to ensure adequate picking and packing capabilities and capacity. Our courier partners proactively planned for increased delivery volumes during this period.”
He said while demand exceeded “even our most optimistic forecasts, putting additional pressure on operations, our teams and partners demonstrated remarkable resilience”.
According to Hanan, the Black Friday and Cyber Monday period saw a significant increase in orders on Bash, with about 70% year-on-year growth from an already high base, surpassing all forecasts.
For the six months to September, Bash online sales grew 47.9% and now contribute 5.6% to sales from 3.8% the same period last year.
Temu said in South Africa it has expanded its logistics partnerships to include Buffalo, Fastway Couriers, Skynet, Mailamericas and iMile as the demand from local customers continues to soar.
Although Temu did not provide details on volume growth since its platform reached South Africa early this year, it said: “We have received valuable feedback from different stakeholders and are continuously working to better understand local preferences and adjust our services accordingly.”
It is not only the apparel, household and electronics online stores that are recording high volumes, grocery retailers also had to beef up their logistics and related resources. Pick n Pay’s on-demand platform ASAP is offering the same extended hours as stores during the festive season, and has abolstered its team — from pickers to drivers and customer support — to meet the increased demand over the festive season “as we notice an uptick in ‘last-minute’ or ‘top-up’ shopping”.
What are people buying online?
On Bash, this festive season’s most sought-after items range from casual summer footwear to coveted branded sneakers, complemented by trending barrel-cut denim. Popular items include premium beverage tumblers, while technology remains a key driver with strong demand for gaming consoles and laptops.
Amazon online marketplace, which entered the South Africa market in May, says the top performing categories by units sold include PCs and electronic and wireless devices including cellphones, game consoles and travel adapters. Given the time of year, toys and board games are in demand. Beauty products, books, video games and kitchen categories are proving popular.
MD Robert Koen said the group is “very pleased with the performance of our Amazon.co.za store thus far, particularly our customers’ response to our first-ever Black Friday sale event in South Africa. We are seeing thousands of new customers shop at the store every week and, what is even more encouraging, we are seeing an increase in repeat visits from customers because they love the convenience of our delivery options and are able to find value in the store every day.”
According to Pitchers, the arrival of Amazon has significantly impacted the market by introducing a global e-commerce giant with advanced systems, competitive pricing and a good product range.
“This has pressured local retailers to enhance their online offerings, improve delivery times and focus on customer experience to stay competitive. It has also spurred growth in the e-commerce sector, pushing smaller businesses to adopt more sophisticated digital strategies. While this competition benefits consumers through better choices and services, it challenges smaller retailers and local platforms to keep up.”
Pitchers expects sustained growth in the e-commerce space next year as more businesses expand their online offerings.
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