Fashion retailer TFG (The Foschini Group) is buying online shopping and delivery platform Quench via its Labs division, in a bid to expand its ecommerce business.
Many consumers are still opting to shop online due to the Covid-19 pandemic, with goods delivered to their door. Quench knows something about adapting to change, as it is one of the liquor delivery services that turned to on-demand groceries and other essential products during lockdowns when liquor was prohibited.
“With this acquisition we gain access to fast, reliable delivery across South Africa, whilst achieving superior delivery unit economics. With 75% of orders currently fulfilled from stores, Quench’s network of micro-carriers will become an essential enabler for our ‘ship-from-store’ strategy” says Claude Hanan, Co-Head of TFGLabs.
“All international market data shows that delivery price, reliability, and speed is highly correlated to e-commerce penetration and purchase frequency.”
The group, which made the announcement on Thursday, says the acquisition will enhance its existing capabilities across the fulfilment network through proprietary software and engineering, bringing a “scientific approach to planning, least-cost routing, and asset utilisation”.
“Additionally, TFG plans to leverage the acquisition to tactically improve overall stock turn and store density,” the group added.
TFG has 29 retail brands and trades in fashion, jewellery, accessories, sporting apparel, homeware, and furniture. It has over 43 000 outlets in 26 countries, with over 26.4 million customers.
Palesa Mofokeng is a Moneyweb intern.