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The Online Retail Industry in South Africa
BY Duncan Bekker
South Africa
17 August 2020
R 14 400.00 (ZAR)  
estimated $ 866.15 (USD) *
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Online Retail


South Africa’s online retail sector, though small by the standards of developed international markets, has been growing rapidly in scope and value. Despite enjoying double-digit sales growth for many years, online retail’s share of South Africa’s retail trade was still below 2% in 2019. The industry has huge long term growth potential. Investment in technology and supply chains is increasing, and the coronavirus outbreak and lockdown has driven an unprecedented boom in online spending and adoption. However the crisis has also affected the economy, employment, investment and incomes, and put pressure on consumer spending.


Coronavirus


The coronavirus outbreak and economic lockdown had a huge impact on the online retail industry. It is estimated that online retail sales grew by around 40% during lockdown. International forecasts suggest that year-on-year growth may be in the region of 100%. A key impact of the crisis has been the huge increase in ecommerce adoption among businesses and consumers who otherwise may not have entered the online market for some time. There has been huge growth at many of the omnichannel retailers, although online gains have been partly offset by declines in consumer spending in physical stores and the wider retail sector.


Report Coverage


This report examines South Africa’s burgeoning online retail industry, with a particular focus on large online only players like Takealot, and the increasing ecommerce capacity of the country’s major traditional retailers. The report includes detailed information on the state and size of the sector, developments and corporate actions and company performance. It includes comprehensive information on the effect of coronavirus and outlines developments emanating from the outbreak as well as from technological advances. There are profiles of 40 companies including major international companies such as Amazon and Alibaba, online only players such as Takealot, marketplaces including Bidorbuy and OneDayOnly, omnichannel retailers including Woolworths, Pick n Pay and Shoprite and classified companies such as Gumtree.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 3
2.2. Geographic Position 5
3. SIZE OF THE INDUSTRY 6
4. STATE OF THE INDUSTRY 18
4.1. Local 18
4.1.1. Corporate Actions 35
4.1.2. Regulations 37
4.1.3. Enterprise Development and Socio-Economic Development 39
4.2. Continental 40
4.3. International 43
5. INFLUENCING FACTORS 44
5.1. Economic Environment 44
5.2. Input Costs 45
5.3. Technology, Research and Development (R&D) and Innovation 47
5.4. Labour 49
5.5. Environmental Concerns 51
5.6. Barriers to Ecommerce Adoption 52
6. COMPETITION 53
6.1. Barriers to Entry 56
7. SWOT ANALYSIS 57
8. OUTLOOK 58
9. INDUSTRY ASSOCIATIONS 59
10. REFERENCES 59
10.1. Publications 59
10.2. Websites 61
APPENDIX 1 62
Summary of Notable players 62
COMPANY PROFILES 67
ALIBABA GROUP HOLDING LTD 67
AMAZON.COM INC 70
BIDORBUY (PTY) LTD 74
BOLT SERVICES ZA (PTY) LTD 76
BUBBLESTORM MANAGEMENT (PTY) LTD 78
CARBONITE INC 80
CLICKS GROUP LTD 82
COTTON ON SOUTH AFRICA (PTY) LTD 86
DIS-CHEM PHARMACIES LTD 88
EVETECH (PTY) LTD 98
FASHION UNITED SA (PTY) LTD 100
FOSCHINI GROUP LTD (THE) 102
GUMTREE SOUTH AFRICA (PTY) LTD 107
HOMECHOICE (PTY) LTD 108
JADE E-SERVICES SOUTH AFRICA (PTY) LTD 110
JD CONSUMER ELECTRONICS AND APPLIANCES (PTY) LTD 112
LOOT ONLINE (PTY) LTD 114
MASSMART HOLDINGS LTD 116
MR PRICE GROUP LTD 122
MUNYHUB ONLINE TICKETING SERVICES (PTY) LTD 127
NASPERS LTD 128
NETFLORIST (PTY) LTD 131
ONECART (PTY) LTD 132
ONEDAYONLY OFFERS (PTY) LTD 133
ORDERIN (PTY) LTD 134
PARCELNINJA (PTY) LTD 135
PICK N PAY STORES LTD 137
QUENCH DELIVERY (PTY) LTD 141
SHOPIFY INC 142
SHOPLI (PTY) LTD 144
SHOPRITE HOLDINGS LTD 145
SPAR GROUP LTD (THE) 150
SPOILER TAGS (PTY) LTD 156
TAKEALOT ONLINE (RF) (PTY) LTD 157
TRUWORTHS INTERNATIONAL LTD 161
UBER TECHNOLOGIES INC 166
WOOLWORTHS HOLDINGS LTD 169
WOOTWARE COMPUTERS (PTY) LTD 173
YUPPIECHEF ONLINE (PTY) LTD 175
ZARA RETAIL SOUTH AFRICA (PTY) LTD 177