Report Coverage
This report examines South Africa’s burgeoning online retail industry, focusing on large online only players like Takealot and the increasing ecommerce capacity of the major traditional retailers. It includes information on the state of the industry, major sales categories, recent developments and trends, corporate actions, and influencing factors such as Black Friday and delivery. There are profiles of 47 companies including major players such as Takealot, international players including Alibaba and Amazon and online only companies such as Gumtree and Bob Shop.
Introduction
• Following steep growth during the pandemic, online sales growth has begun to slow. \r\n
• South African online sales grew by 30% year on year in 2022, significantly faster than total retail sales which grew by just 1.7%. \r\n
• Online sales growth slowed from 40% in 2021 and may well have slowed further in 2023 as total retail sales declined by 1.4% year on year in May 2023. \r\n
• This report examines online retail focusing on large online only players like Takealot, and the increasing ecommerce capacity of traditional retailers. \r\n
• Amazon’s launch is expected to shake up competition in the sector. \r\n
• The Competition Commission has identified practices used by local online retailers that it says are anti-competitive.
Trends
• Amazon’s imminent launch could propel online retail sales and shake up competition in the sector.
• Deliveries to townships are growing.
• Online sales growth is beginning to slow as consumer spending comes under pressure.
• Social commerce and live shopping are growing.
• Use of technology such as AI and chatbots.
Opportunities
• Amazon’s launch could create opportunities for small online merchants.
• Payment solutions such as buy now pay later.
• The Competition Commission’s online platforms inquiry findings could result in more favourable terms for smaller online retailers which use online platforms to sell their goods.
• The Post Office’s decline has given private couriers an opportunity, particularly in rural areas and townships.
• Use of technology to expand and quicken deliveries, including smart lockers and AI.
Challenges
• Ecommerce is dominated by Takealot, major retailers and Uber Eats.
• Foreign-based online retailers with no physical presence in South Africa present a threat, as they are not subject to local laws.
• High data costs make it difficult for many to access the internet.
• Input costs such as electricity and petrol have risen.
• Lack of recognisable street addresses makes it difficult for online retail to expand to rural areas and townships.
• Loadshedding affects sales.
• Online retail remains small at less than 5% of retail sales.
• Robberies, fraud and cybercrime.
• The Post Office’s decline has made delivery more expensive.
Outlook
• Growth in online retail sales has begun to slow following the surge during the pandemic, and as consumers come under financial pressure. \r\n
• Retailers are positive as growth continues to exceed traditional retail sales by some measure. \r\n
• Despite some challenges, the ecommerce boom will likely continue to transform the retail industry.\r\n
• There is strong competition, and online retail is still far from reaching the point of maturity. \r\n
• Local online retailers have some way to go to improve availability and prices. \r\n
• Delivery costs remain a key challenge.
Full Report
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Industry Landscape
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Historical Reports
Online Retail in South Africa 2021-11-06
R 6 500.00(ZAR) estimated $372.44 (USD)*
View Report Add to CartOnline Retail in South Africa 2020-08-17
R 1 900.00(ZAR) estimated $108.87 (USD)*
View Report Add to CartTable of Contents
[ Close ]PAGE | ||
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1. | INTRODUCTION | 1 |
2. | DESCRIPTION OF THE INDUSTRY | 1 |
2.1. | Industry Value Chain | 3 |
2.2. | Geographic Position | 5 |
2.3. | Size of the Industry | 6 |
3. | LOCAL | 8 |
3.1. | State of the Industry | 8 |
3.2. | Key Trends | 16 |
3.3. | Key Issues | 16 |
3.4. | Notable Players | 17 |
3.5. | Trade | 19 |
3.6. | Corporate Actions | 19 |
3.7. | Regulations | 20 |
3.8. | Enterprise Development and Social Development | 22 |
4. | AFRICA | 23 |
5. | INTERNATIONAL | 24 |
6. | INFLUENCING FACTORS | 26 |
6.1. | Economic Environment | 26 |
6.2. | Labour | 26 |
6.3. | Environmental Issues | 27 |
6.4. | Technology, R&D, Innovation | 28 |
6.5. | Input Costs | 29 |
6.6. | Black Friday | 30 |
6.7. | Delivery | 30 |
6.8. | Crime | 31 |
7. | COMPETITIVE ENVIRONMENT | 32 |
7.1. | Competition | 32 |
7.2. | Ownership Structure of the Industry | 33 |
7.3. | Barriers to Entry | 35 |
8. | INDUSTRY SUMMARY | 36 |
9. | OUTLOOK | 37 |
10. | INDUSTRY ASSOCIATIONS | 37 |
11. | REFERENCES | 37 |
11.1. | Publications | 37 |
11.2. | Websites | 38 |
APPENDIX 1 | 40 | |
Summary of Notable Players | 40 | |
COMPANY PROFILES | 48 | |
Africa Online Retail (Pty) Ltd | 48 | |
Alibaba Group Holding Ltd | 50 | |
Amazon.com Inc | 53 | |
Appetite South Africa (Pty) Ltd | 57 | |
Bifrost Distribution (Pty) Ltd | 58 | |
Bob Group (Pty) Ltd | 59 | |
Bolt Services ZA (Pty) Ltd | 61 | |
Bubblestorm Management (Pty) Ltd | 63 | |
Caught Online (Pty) Ltd | 65 | |
Clicks Group Ltd | 66 | |
Cotton On South Africa (Pty) Ltd | 70 | |
Dis-Chem Pharmacies Ltd | 73 | |
Dreamware Technology (Pty) Ltd | 85 | |
Evetech (Pty) Ltd | 86 | |
Fashion United SA (Pty) Ltd | 88 | |
First Technology IT Suppliers (Pty) Ltd | 90 | |
Foschini Group Ltd (The) | 91 | |
Gumtree South Africa (Pty) Ltd | 96 | |
HomeChoice (Pty) Ltd | 97 | |
Jade E-Services South Africa (Pty) Ltd | 99 | |
JD Consumer Electronics and Appliances (Pty) Ltd | 101 | |
Massmart Holdings Ltd | 103 | |
Mr Price Group Ltd | 108 | |
Munyhub Online Ticketing Services (Pty) Ltd | 114 | |
Naspers Ltd | 115 | |
Nedbank Ltd | 119 | |
NetFlorist (Pty) Ltd | 128 | |
OneCart (Pty) Ltd | 129 | |
Onedayonly Offers (Pty) Ltd | 131 | |
Pepkor Holdings Ltd | 132 | |
Pick n Pay Stores Ltd | 137 | |
Quench Delivery (Pty) Ltd | 142 | |
Retailability (Pty) Ltd | 143 | |
Shopify Inc | 147 | |
Shoprite Holdings Ltd | 150 | |
SPAR Group Ltd (The) | 176 | |
Supper Society (Pty) Ltd (The) | 181 | |
Takealot Online (RF) (Pty) Ltd | 182 | |
Tetra Computing (Pty) Ltd | 187 | |
Truworths International Ltd | 188 | |
Uber Technologies Inc | 193 | |
VMS Group (Pty) Ltd | 196 | |
Vodacom Group Ltd | 198 | |
Woolworths Holdings Ltd | 202 | |
Wootware Computers (Pty) Ltd | 207 | |
Yuppiechef Online (Pty) Ltd | 208 | |
Zara Retail South Africa (Pty) Ltd | 210 |