Takealot, South Africa’s leading online retailer, is introducing delivery within an hour for items ranging from phone chargers to toys as it braces for Amazon.com to enter the country’s e-commerce sector.
The rapid delivery service will initially be offered in parts of Cape Town, where Takealot’s parent company Naspers is headquartered, before expanding more widely, the retailer said in a statement on Wednesday.
South Africa is the continent’s most developed economy and has a youthful population, together with one of the largest upper-middle-income economies in the region. The market is drawing increasing attention from retail giants such as Walmart and Amazon, which could roll out online delivery this year.
E-commerce only makes up about 4% of South African retail, which presents a market growth opportunity three to five times bigger than in peer countries, Takealot Group CEO Mamongae Mahlare said on Wednesday.
Online retail sales in South Africa grew 30% to R55-billion last year, according to a study by World Wide Worx.
“South Africa is still nowhere in terms of online sales, which means that there’s massive opportunity for growth,” Mahlare said. “If you look at just the nature of our country and what e-commerce does, it’s a great equaliser because whether you’re in an urban or rural area, you all have access to the same products.”
TCS | Takealot Group CEO Mamongae Mahlare on the outlook for e-commerce
Takealot was founded in 2011 and reported US$827-million in revenue in 2022. Its new service will compete with companies that offer fast grocery delivery, including Shoprite Holdings’ Sixty60 app. — Janice Kew and Loni Prinsloo, (c) 2023 Bloomberg LP