Maximizing Africa’s E-Commerce Potential
Maximizing Africa’s E-Commerce Potential

Maximizing Africa’s E-Commerce Potential

September 21st, 2016

With African e-commerce promising enormous activity for online retailers, many are turning to local logistics experts to create efficient, Africa-adapted supply chains

​With Africa’s impressive economic expansion and emerging middle class of 300 million people expected to surge further, e-commerce promises enormous activity by bridging the continent’s traditional small shop retail structures and limited big chain distributors or malls. To assure that potential is fully realized, e-retailors are working to adapt supply chain models from other regions to the complex and vastly contrasting challenges Africa poses. As they do, many e-merchants are striking partnerships with logistics experts whose experience and insight in Africa help avoid errors early on that could undermine future activity.

“The advance of digital capacities in Africa, including for retail, hasn’t erased the supply chain challenges that exist across the continent, like limited transport networks, enormous distances, security concerns and strict administrative procedures,” notes Xavier Personnic, head of fast-moving retail goods and e-commerce activities for Africa at Bolloré Logistics. “Cutting and pasting distribution strategies from other regions won’t work in Africa, so e-retailers are adjusting. ”

Assessing complexities particular to African markets is vital, he adds, with all having potential impact on delivery time. “The African e-consumer is just as demanding and sensitive as those in Europe or the U.S.,” Mr. Personnic explains. “If retailers can’t respect product or delivery promises, disappointed African consumers won’t come back.”

That risk makes proper analysis of supply chains in Africa – and complications they encounter – a crucial consideration from the outset.

Sales volumes often make maintaining large stores of imported products financially impractical, for example. Consequently, many retailers use longer maritime transport of spot shipments – but which lengthens the arrival of goods buyers want quickly. That impatience requires analysis of what popular goods may instead be stocked in limited quantities locally to speed delivery time, and when that trade-off isn’t worth it.

Similarly, restricted warehouses offering full security, cold chain and other services can limit and complicate storage choices. But implanted logistics experts can also advise on when storage compromises are merited to speed supply chains. Faster delivery of highly sought-after items like tablets and smartphones, for example, is mooted if they face high security risks during storage.

Local experience – and human representation – also greatly facilitates e-retail clearing African customs. Those document-heavy, time-consuming procedures are still designed for bulk container cargo. Consequently, the variety, type and volume of goods popular in e-commerce tends to clear inspection faster when ushered through by a local customs broker working with retailers.

In addition, pricier items like watches, jewelry or products posing competition to protected local goods face dizzying customs tariffs. Determining the type and volume of merchandize worth importing is another supply chain decision e-retailers make early on to avoid prohibitively high import costs.

Movement of orders from ports towards final destinations can also create challenges.
Enormous distances must often be covered using limited and at times rough road systems -- or through urban centers infamous for crawling traffic flows. Perishables like food or chilled goods can be ruined by excessive unexpected delays, and security measures for less fragile merchandize should also be conceived based on local factors.

Other complicating considerations include last mile delivery, which can require a full range of available transport options – some quite unorthodox. Limited e-payment capacities among African consumers makes cash-on-delivery compensation frequent, meantime, yet creates questions about the reliability and security of cash paid out.

The number, complexity and potential expense of those considerations have many e-commerce companies turning to locally experienced logistics partners as they create rational and realistic African supply chains.

CDiscount, for example, scaled down its product catalogue to a narrower range of goods better adapted to African consumer demand and supply chain capacities. Sportswear giant Decathlon, meantime, established an e-commerce model in partnership with Jumia, allowing allows it to tailor goods it markets to online demand.

“This isn’t an activity anyone wants to compromise with early errors that costs them customers and activity in the long-term,” Mr. Personnic says. “Getting input from logistics partners operating in Africa can help avoid that.

Chiffres clefs
  • 20%

    Le Boeing 787 et l'Airbus A350 sont plus économes en carburant

  • 70%

    de la population mondiale urbanisée en 2050

  • 27

    mégapoles contre 19 attendues d'ici à 2050, avec au moins 10 millions de personn...

  • +18,4%

    croissance pour le E-commerce en Europe en 2015

  • 82%

    des marchandises sont transportées par route

  • 1 milliard

    Population en Afrique

  • 60%

    de la population de l'Afrique sera urbanisée d'ici 2050

  • 7,5%

    de croissance du PIB indien en 2014

  • 4,9%

    de croissance du PIB Africain en 2016

  • 6,1%

    la plus forte croissance au monde du PIB en Asie de l'Est

  • 19 224 teus

    transportés par le MSC Oscar, le plus grand porte-conteneurs dans le monde

  • 396 m

    est la taille du navire MSC Oscar

  • 120 h

    est le record de vol non-stop fait par Solar Impulse

  • 4,5%

    de croissance en 2015 pour la demande mondiale de fret aérien

  • 20%

    Le Boeing 787 et l'Airbus A350 sont plus économes en carburant

  • 70%

    de la population mondiale urbanisée en 2050

  • 27

    mégapoles contre 19 attendues d'ici à 2050, avec au moins 10 millions de personn...

  • +18,4%

    croissance pour le E-commerce en Europe en 2015

  • 82%

    des marchandises sont transportées par route

  • 1 milliard

    Population en Afrique

  • 60%

    de la population de l'Afrique sera urbanisée d'ici 2050

  • 7,5%

    de croissance du PIB indien en 2014

  • 4,9%

    de croissance du PIB Africain en 2016

  • 6,1%

    la plus forte croissance au monde du PIB en Asie de l'Est

  • 19 224 teus

    transportés par le MSC Oscar, le plus grand porte-conteneurs dans le monde

  • 396 m

    est la taille du navire MSC Oscar

  • 120 h

    est le record de vol non-stop fait par Solar Impulse

  • 4,5%

    de croissance en 2015 pour la demande mondiale de fret aérien

  • 20%

    Le Boeing 787 et l'Airbus A350 sont plus économes en carburant

  • 70%

    de la population mondiale urbanisée en 2050

  • 27

    mégapoles contre 19 attendues d'ici à 2050, avec au moins 10 millions de personn...

  • +18,4%

    croissance pour le E-commerce en Europe en 2015

  • 82%

    des marchandises sont transportées par route

  • 1 milliard

    Population en Afrique

  • 60%

    de la population de l'Afrique sera urbanisée d'ici 2050

  • 7,5%

    de croissance du PIB indien en 2014

  • 4,9%

    de croissance du PIB Africain en 2016

  • 6,1%

    la plus forte croissance au monde du PIB en Asie de l'Est

  • 19 224 teus

    transportés par le MSC Oscar, le plus grand porte-conteneurs dans le monde

  • 396 m

    est la taille du navire MSC Oscar

  • 120 h

    est le record de vol non-stop fait par Solar Impulse

  • 4,5%

    de croissance en 2015 pour la demande mondiale de fret aérien

  • 20%

    Le Boeing 787 et l'Airbus A350 sont plus économes en carburant

  • 70%

    de la population mondiale urbanisée en 2050

  • 27

    mégapoles contre 19 attendues d'ici à 2050, avec au moins 10 millions de personn...

  • +18,4%

    croissance pour le E-commerce en Europe en 2015

  • 82%

    des marchandises sont transportées par route

  • 1 milliard

    Population en Afrique

  • 60%

    de la population de l'Afrique sera urbanisée d'ici 2050

  • 7,5%

    de croissance du PIB indien en 2014

  • 4,9%

    de croissance du PIB Africain en 2016

  • 6,1%

    la plus forte croissance au monde du PIB en Asie de l'Est

  • 19 224 teus

    transportés par le MSC Oscar, le plus grand porte-conteneurs dans le monde

  • 396 m

    est la taille du navire MSC Oscar

  • 120 h

    est le record de vol non-stop fait par Solar Impulse

  • 4,5%

    de croissance en 2015 pour la demande mondiale de fret aérien