With schools still open before the December holiday season has properly clicked into gear, Pepkor CEO Pieter Erasmus said there’s a real concern that South Africa’s port congestion could affect stock needed for the new school year in January 2024.
This after he told a news agency that the group has about R700 million in goods waiting to be offloaded by vessels delayed at the country’s ports.
Although Erasmus didn’t identify the Port of Durban as the main snag in their supply chain, it can be confirmed that the port is the country’s main land-sea container access point that remains severely congested.
The Port of Cape Town, for example, has seen significant backlog easing thanks to expanded equipment capacity.
This is according to the latest data update for the logistics sector, compiled by the South African Association of Freight Forwarders (see main story posted November 30).
Erasmus said although Pep stores had implemented a domestic near-sourcing strategy to mitigate against importation challenges, the group had no alternative for importing certain stocks.
“We've got significant value items stuck on the sea (…) between one and two weeks late,” he said.
Erasmus, though, is positive that consumer spending for the festive season will remain largely unaffected.
“We don't think the impact will be that big on our Christmas trade, bearing in mind we're a more basic business, with a higher component of replenishment.”
He told Reuters it’s unclear how long Pepkor’s inbound stock will be delayed.
“The feedback we're getting is eight to 12 weeks but there is no certainty.”
