Africa growth demands more efficient retail logistics

The retail logistics environment needs a step change if it wants to ensure sustainability, according to Riaan Cronje, commercial director of Broco Transport Solutions. “If we do not create the necessary changes in the transport and logistics industry servicing the retail market, we are not going to be able to access the African market as competitively as we want to as we will not be able to deliver product at competitive prices.” Speaking at the Transport Forum in Bellville recently, Cronje said one had to continue to delight the consumer and that meant having the right product at the right price at the right time at the right place. “That is the only way one will retain and grow market share. To achieve that the supply chain is going to have to look at increasing collaboration between the various stakeholders. “Retailers, suppliers and logistics service providers are all going to have to work together better if one truly wants to address the ongoing challenges faced,” he said. “With the pressure on the oil price, increasing food prices, the bigger call for the reduction of CO2 footprints, better solutions are the order of the day.” Cronje said with no blueprint available the industry had the opportunity to tailor-make its own solutions while the changing landscape of retail logistics allowed it to optimise these solutions. Using Shoprite as an example, Cronje said the company had seen major results from efficiencies in operations. “This is a company that has seen turnover growth of 14.4% and an operating profit of 17% while they have opened 90 new stores across Africa. He said Shoprite had invested some R8 billion to fund the expansion of its centralised distribution operation. “Retailers have realised that it allows for improved inventory optimisation and improved order fill and on-shelf availability,” he said “Ultimately investing in best practices allows one to improve the operational environment and facilitate cost saving in the long term.” According to Cronje more and more retailers are forming strategic relationships with their logistics service providers. “Not only are we sharing more best practices through these partnerships, but we are seeing situations where the retailer and logistics expert are meeting with the supplier together to talk about challenges and opportunities to allow for a smoother and better functioning supply chain.”