Online retail fuels courier business

SA's growing appetite for buying goods over the Internet is not only boosting online retailers, but it has also become a big growth driver for courier services. A MasterCard Worldwide Online Shopping Survey showed a significant increase in online shopping among South Africans in 2013, with 58% of respondents saying they use the Internet for online shopping.

Retail markets have grown in importance to the courier industry, which was traditionally focused more on businesses than consumers. Retailers, especially online retailers, rely on courier services to get their goods to customers.

"This landscape has most certainly changed with about three e-commerce sites a week approaching the company. What is amazing about this is that these are mostly SME guys starting their own businesses,” says  Diederick Stopforth, the national sales and marketing manager for SkyNet. This however is exciting especially for entrepreneurs as someone who owns an art shop in Nelspruit can now sell goods to someone staying in Cape Town. This allows retailers to grow their geographical footprint beyond just their surrounding areas.

The success of these e-commerce sites however depends heavily on logistical partners that understand the needs and demands of clients at the end of the chain. It’s not just about delivering the product but there needs to be an automated process and constant communication regarding the status of the delivery that is filtered back to the client.

As new opportunities emerge for the courier industry, there are also several challenges in making this a profitable market. The new tolling system on South Africa’s roads and the poor state of some roads in the country, particularly roads in rural areas are ongoing obstacles. In addition, dropping off goods at someone's home address can be tricky, if a courier has to attempt delivery more than once they lose money.

That however does not mean that this is not a growing market, with huge potential going forward. With the increased availability of broadband access, more affordable data costs offered by mobile operators, and the consistent development of mobile devices, online shopping is becoming more and more popular. As the awareness grows in terms of the convenience and variety of products available at just a click of a button, retailers will need logistical partners that offer their customers reliable, efficient, value-for-money delivery options.

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