E-sales set to exceed expectations in 2019

South Africa’s online retail sales are continuing to boom, with growth expected to remain in double digits at around 20% per annum in 2020/21 – feeding demand for commercial property for logistics hubs. Moreover, this growth in the e-sector includes courier firms that are reporting strong demand for services in major centres of provinces

such as the Western Cape, Free State, Gauteng and KwaZuluNatal. Research by leading expert on internet and mobile technology, World Wide Worx, showed that retail sales were set to exceed all expectations in 2019. In its study titled Online Retail in South Africa 2019, conducted with the support of Visa and Platinum Seed, it was found that e-sales were set to exceed R14 billion in 2019, comprising 1.4% of the total R1 trillion in traditional retail sales. This growth represents a 25% increase in sales compared with the previous year. According to the study, the 2% mark is likely to be reached by 2022.

World Wide Worx forecasts for the period 2018 to 2020 show online retail sales more than doubling from 2016 to almost R20 billion, a year sooner than originally forecast in 2016. According to the study, clothing is currently the fastestgrowing sector with 23% of respondents coming from this sector. But it is also the sector with the highest turnover of businesses, while the sale of alcohol, tobacco and vaping is another fast-growing category of goods. The second largest number of respondents for the study fell into the ‘general’ category, at 10.8%, which included sites like Loot. The third largest number of respondents were found in four categories – arts and crafts/decor; alcohol, tobacco and vaping; food, groceries, non-alcoholic beverages and gourmet food; as well as home and garden. The study also found that some online retailers had

recorded growth of between 25% and 50%. Sales manager for The Courier Guy, Charmaine Pelser, said business demand was strong and growing daily, driven by online shopping sales locally and in the SADC region. “We have had an annual growth of 40% each year. Generally speaking, Gauteng is most certainly our biggest demand area, followed by Cape Town, KwaZuluNatal and Bloemfontein.” Pelser said demand from the SADC region had also grown speedily and continued to increase daily. “We also have our lockers that we are launching in June, an online app where you can book your collection and the online receiver can collect their parcel in the locker. “Alternatively, the online

seller can put all their parcels in the locker and we will collect at the locker and deliver to the receiver’s doorstep. “We have learned that online companies are opening all over the country and most are doing it from home – therefore our lockers will offer such a benefit,” Pelser said. Speaking at a South African Property Owners’ Association Broker’s breakfast in Umhlanga recently, auctioneer and founder of In2Assets, Andrew Miller, said Durban was benefiting from the growth in online retail sales. He said it was driving the demand for logistics hubs as logistics firms sought to supply services. Online companies are opening all over the country and most are doing it from home. – Charmaine Pelser