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Global Logistics Firms Race to Deliver as More Africans Click ‘Buy’ Online

2 months ago
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Global Logistics Firms Race to Deliver as More Africans Click ‘Buy’ Online

Global logistics firms race to capture Africa’s expanding e-commerce market

With millions of new customers in Africa shopping from phones instead of storefronts, what happens after the “Buy Now” button is becoming the next big business opportunity for both local and global logistics companies.

Seth Onyango, bird story agency 

Global logistics firms are steadily expanding their footprint across Africa as the continent’s digital commerce surge outpaces the existing delivery infrastructure.

Already, rising smartphone use and increasing online purchases have reshaped consumer habits, highlighting logistics as a critical battleground.

The ‘Hunger Games’ have also reached Africa’s food delivery scene, where global contenders like Uber Eats and Glovo are battling for market share in the fast-paced race to satisfy the continent’s growing appetite for convenience.

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For years, fragmented supply chains, poor road networks, and high logistics costs have slowed the continent’s ability to meet consumer demand in the digital space.

Even as smartphone use and digital payments expanded, the logistical machinery needed to fulfil that demand was slow to materialise.

McKinsey estimates suggest that Africa’s e-commerce revenue could reach $75 billion by 2028, a figure underpinned by growing smartphone use and digital payments.

But delivery networks remain underdeveloped: poor addressing, congested roads, and reliance on cash-on-delivery continue to frustrate shoppers and freight operators alike.

Now, that mismatch between rising consumer appetite and underdeveloped delivery systems is pulling in the world’s largest logistics players with readily deployable capital and expertise.

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Last week, DHL announced it will shell out €500 million over five years to expand warehousing, cold-chain systems and delivery capacity across African markets.

Funds will be a major boost for services dedicated to health-related goods such as vaccines, medical devices, and pharmaceuticals.

While the plan includes healthcare logistics, much of the infrastructure will also support e-commerce: new warehouses, enhanced delivery routes, and deeper integration with local courier networks in cities like Nairobi, Lagos, and Cairo.

The German logistical giant, sees huge growth potential in these regions, particularly in time-sensitive shipments like vaccines, stem cells, and cryogenic materials.

According to Grand View Research, the African pharmaceutical market size was estimated at US$26.85 billion in 2023 and was forecast to grow annually at a rate of 3.4% from 2024 to 2030.

Notably, in 2021, African logistics startups raised US$200.77 million across 37 funding rounds in just the first eight months of the year, putting the sector on track for a record-breaking fundraising year.

This surge was driven by a pandemic-era shift toward tech-enabled transport and a spike in demand for last-mile delivery as more Africans shopped and ordered food online during lockdowns.

Last year, Amazon launched Amazon.co.za in South Africa, opening two fulfilment centres and rolling out same-day and next-day delivery across Cape Town and Johannesburg.

The platform now features over 3,000 pickup points, supports thousands of independent local sellers, and is backed by a dedicated local customer service team.

Amazon is upbeat this will give it an edge over rivals like Takealot, Checkers Sixty60, and Pick n Pay’s Mr D in South Africa.

Meanwhile, across the continent, logistics firms are racing to close that gap, with other players like Aramex scaling operations in tandem.

The Dubai-based provider upgraded its Casablanca sorting hub and started testing drone delivery in Ghana’s Accra region in 2023. In East Africa, it is partnering with ride-hailing platforms to use their drivers for package drops.

UPS, meanwhile has a significant presence and is actively expanding its logistics and shipping operations in Africa.

In 2022, UPS partnered with Jumia, a leading e-commerce platform, to leverage its last-mile infrastructure and expand its reach across the continent.

This partnership initially focused on Kenya, Morocco, and Nigeria, with plans for further expansion. UPS also has a strong presence in South Africa, offering various shipping services and logistics solutions.

In West Africa, Nigeria’s Kobo360, co-funded by International Finance Corporations, continues to build its freight-matching platform across the region. Kobo360 uses digital tools to match shippers, drivers, and storage space in real-time.

Infrastructure developers are following that digital trend. Kuwait-based Agility recently broke ground on multi-million‑dollar logistics parks in Abidjan, Maputo, and Cairo, complete with integrated customs areas and pack-and-ship zones near transport corridors.

The coming two years will test which companies can scale fast and localise delivery effectively. Firms that master urban density—and extend logistics into suburbs and rural areas —will control the ecosystem of African e-commerce.

bird story agency 

 

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