Retailers turn to e-commerce firms for sales boost

Local retailers and grocery outlets including Chandarana Foodplus, Tuskys, Carrefour, Naivas and Zucchini have forged partnerships with e-commerce firms in a bid to satiate demand from young, tech-savvy shoppers and grow sales volumes through digital platforms.

The trend was highlighted in the Nielsen Retail Measurement Defined FMCG Basket findings released last week, which said that e-commerce would continue to evolve as the trade of fast-moving consumer goods (FMCG) online is projected to grow five times faster than offline transactions over the next five years.

French-based retailer Carrefour, Tuskys and Naivas have signed deals with e-commerce giant Jumia while Chandarana FoodPlus has an ongoing agreement with digital retail platform Grocerypik. Naivas, Onn the Way Supermarket and Zucchini also recently sealed a deal with Spanish delivery firm Glovo to help them grow their customer base in areas where they lack physical stores. The partnerships are largely fuelled by the growing Internet penetration and take-up, according to recent findings by market insights firm Nielsen on online shopping in Kenya.

“The channels we reach our customers will change rapidly, of course, with lots of focus on our online and direct delivery platforms,” said Tuskys chief executive Dan Githua.

The Nielsen report says three out of 10 local shoppers are willing to shop online in the next six months but quality concerns, additional costs and delivery time remained the biggest barriers.

“Trust levels are low in the local e-commerce landscape but all indicators show that e-commerce is set for exponential growth in the near future,” said Nielsen East Africa Consumer Insights Lead Pauline Achayo.