Supermarket retailing in South Africa has been undergoing significant changes in recent years, driven by the evolving preferences of consumers and the growing competition in the retail sector.
For Conor Powell, In-store Solutions Manager at packaging and moving goods supply chain company, CHEP Sub-Saharan Africa, the face of retail is always changing in South Africa – but more sustainable solutions are here to stay.
As a supply chain expert with a focus on first class service, products and packaging, Mr. Powell builds on some of the industry trends highlighted by the market.
More “specials” to keep up with the looming economic recession
It’s one of the few upsides of an economic downturn. Towards the end of 2022, a Black Friday study revealed that a staggering 84% of South Africans are bargain hunting for everyday essentials. It’s also likely that more locals (27% surveyed) will be putting their money towards technology to mitigate the effects of load shedding.
“Fewer people will be visiting multiple stores – the ones they’ve previously supported – if they can save money (and petrol) on a one-stop-shopping experience,” says Mr. Powell.
E-commerce is “sort of” on the rise
While South Africans embraced online shopping throughout the COVID-19 lockdown, there is still room for shopper uptake in e-commerce. Although the use of online retail markets is expected to rise by 25% in 2023, that still only makes up about 5% of total retail across categories in South Africa.
For perishable goods and large baskets, South Africans still prefer an in-person experience. With premiums on deliveries for groceries, for example, it may be more convenient, but not necessarily cheaper to shop online. However, the last mile must improve before South Africa starts to move towards the online shopping culture experienced in other parts of the world.
With online shopping yet to reach its full potential, it means one South African trend has returned…
Mall culture alive and well
Especially since the ease of lockdown restrictions, the return to malls – which many South Africans see as entertainment centres – has been fast and furious. With the increase in loadshedding, many people are flocking to malls for the promise of electricity, wi-fi, and hot food. It’s for this reason that supermarkets at malls are becoming more aesthetically pleasing.
Not every person visiting a mall is there to shop for groceries, they are more likely to spend on other items as part of the entertainment for the day. It’s also changing the way in which retailers are presenting their products.
Pre-filled packaging is drawing customer attention
Pre-filled packaging solutions, like retail-ready packaging (RRP) have emerged as a key factor in driving efficiency and capturing customer attention especially during high-traffic periods.
RRP is an innovative solution that allows products to be moved from factory floor to the store floor on a single pallet, to be delivered either directly within a shelf, in an aisle, or as a freestanding unit. RRP also allows the retailer to move product and displays to different high-traffic zones through the day, without having to unpack shelves. In a survey of its international clients, CHEP found that a major retailer cut replenishment time by 75-80% and boosted sales by 7-8% after adopting retail-ready display platforms.
According to Mr. Powell, neuroscience studies suggest that such platforms stimulate impulse buying behaviour in consumers, and their streamlined end-to-end journey aligns with the current product availability and price point requirements of shoppers.
Sustainable packaging is increasingly important
Internationally, it’s been proven that shoppers want more sustainable products, and Mr. Powell believes this will be a trend in South Africa as well. Packaging is going to be essential to this, to lessen the reliance on single-use materials.
An RRP unit can serve as point-of-sale material once the perforated part of the unit is removed. “The pallets do not need to be repacked or transferred, thus reducing resource consumption, less product damages and platform demands. Moreover, RRP eliminates most secondary packaging, thereby reducing waste,” concluded Mr. Powell.
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