Conquering the ‘logistics barrier’ Even as the growth opportunity of e-commerce in Africa seems immense, many industry watchers believe that Africa is only just at the starting point of its e-commerce decade. “Africa is only just starting down the digital commerce road. While there are some really progressive entrepreneurs, supported by solid national policy frameworks (eg. Egypt), good telecom coverage, and active delivery structures, out of the 55 African states, around half are still only seeing eCommerce in the capital city,” says Tempest.
Among other encouraging developments that have been creating ripples in the e-commerce logistics landscape of Africa is the much-awaited entry of US behemoth and world’s largest e-commerce platform Amazon which is now turning its focus on the African continent as it looks for new consumers. Amazon is reportedly preparing to launch its South Africa marketplace around February 2023.
Trust, regulations & transportation hurdles However, for online retail to happen several simultaneous and essential processes like warehousing, packing, sorting, inventory management, labelling, billing, shipping, payment collection, order management, facilitating returns and exchanges need to work in tandem to deliver the ultimate e-commerce delight to its consumers, at scale. Tempest observes, “Cross-border online trade (part of digital trade) is certainly a major driver for the African Continental Free Trade Area (AfCFTA). Transport infrastructure is one issue that you are looking at; telecoms infrastructure and data costs are a challenge. But the three major barriers are customs procedures which are often very antiquated and create delays; payment services which can cause delays of days even while payments clear; and regulations. Often these three elements are interconnected with other challenges.”
Sanjeev Gadhia, founder and CEO of a dedicated all-cargo airline based in Nairobi, Kenya, Astral Aviation told the publication, "Astral Aviation has invested in additional freighter aircraft to meet the demand for e-commerce to and within Africa. Astral operates dedicated freighters from Hong Kong and Dubai to Africa with a mix of e-commerce and general cargoes which enables its clients to connect with its intra-African network ex Nairobi."