Retail
expansion is key to DHL Express’ Africa business strategy. This is according to
Sumesh Rahavendra, Head of Marketing for DHL Express, Sub Saharan Africa. The
recently released A.T Kearney African
Retail Development Index further validated the company’s plans as it ranked
the top 10 countries in Sub-Saharan Africa for retail expansion and highlighted
Rwanda,
Nigeria, Namibia, Tanzania and Gabon as Africa’s most attractive markets for
retailers looking to expand.
According to Deloitte,
Africa’s middle class has tripled over the last 30 years, and the current
trajectory suggests that the African middle class will grow to 1.1 billion in
2060, making it the world’s fastest growing continent. This growth, coupled
with the forecasted GDP growth of over 6% which the International Monetary Fund
(IMF) is predicting, drives the potential for retail growth on the continent
significantly through increased purchasing power and consumer demand.
The
growth of ecommerce and access to technology has further upended the
traditional shopping experience for consumers, and retailers are increasingly
beginning to maximize the opportunities arising from the growing number of
digitally-empowered consumers, who are opting to purchase goods via ecommerce channels
“We are now in a position to directly relate growth in
our retail footprint to growth in our earnings so we know the potential is huge.”
says Rahavendra.
According to the index, African retailers such as South Africa’s
Shoprite, which operates in more than 16 African countries, and Nakumatt, which
is based in Kenya and has stores in neighbouring Uganda, Rwanda, and Tanzania,
have done most of the expansion, but global retailers are moving in. In 2011,
Wal-Mart acquired South Africa’s Massmart, and it plans to open 90 supermarkets
across Africa over the next three years.
DHL Express, who has a retail presence in over 2400
outlets across Africa, will continue its aggressive expansion strategy in Africa
in 2014. “We
have made great progress in making the global market and world at large more
accessible and connected by increasing the number of points where customers can
access DHL and our global network. This allows anyone – from a student to a
small business – to access over 220 countries and destinations that we serve.”
Key retail markets for DHL currently are Nigeria,
South Africa, Kenya, Tanzania, Uganda, Ghana, Senegal, Côte d'Ivoire,
DRC, Zambia and Zimbabwe.
In Kenya, DHL has been significantly expanding its retail
footprint across the country so as to ensure that private and business
customers have easier access to sending their shipments on the most
secure network to anywhere in the world.
“Kenya is a dynamic and vibrant economy, and it is imperative
that we can facilitate international trade for small, medium and large
businesses. DHL Express Kenya has partnered with like-minded SME’s and
companies; which add to over 100 new outlets to our retail footprint across the
country. These partnerships have not only created countless employment
opportunities and additional revenue for all our agents but have also
contributed to the overall growth of our business locally.” Said Alan Cassels,
Country Manager, DHL Express Kenya.
Commenting on the general retail landscape across
Africa, Rahavendra adds, “Supply chains in Africa are more challenging than
many other markets in the world. The key to success is understanding these
challenges in order to offset the risks versus the opportunity which the
continent offers. This knowledge will allow retailers to service markets with a supply chain that
is agile enough to respond quickly to sudden or unexpected changes, flexible
enough to customize products and efficient enough to protect margins. We have
been active on the continent for over 36 years, and being the only
international express company to operate our own airline and extensive
infrastructure throughout Africa, we are well positioned to connect Africa with
the world.”
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