Connectivity challenges hold back Africa’s e-commerce potential

E-commerce couriering in Africa could see significant growth if the continent overcame three online obstacles – accelerated, accessible and affordable connectivity. Thankfully, multinationals are frantically seeking solutions to attain market share in the scramble for the continent’s cyber consumer spoils, says Dennis Laxton, professor of logistics and supply chain dynamics at Wits University, who disagrees with the generally held contention that the continent is hamstrung by insurmountable last-mile snags. At a recent air cargo conference in Kempton Park, CEOs of several leading airlines

and related service providers stressed that home-stretch delivery was a major issue in populated areas where most people did not have physical addresses, let alone bank accounts. And where potential e-spenders do have the means to buy online, the question remains – how do you complete the last mile of a package sent from a 1st world warehouse to a 3rd world shantytown recipient that has no street address? Worse still, what if that recipient lives in Alexandra and his or her shack has just been washed away by torrential rain? But according to Laxton remarkable developments are beginning to emerge in countries like Kenya. “It’s interesting what Vietnam is doing there.

“They are helping Kenya roll out fibre optics on a large scale after it was shown in Vietnam how its economy could be turned around through highspeed, cheap and largely accessible connectivity.” Keeping in mind the East-African country’s burgeoning role as a leading player in China’s logistical plans for Africa, Laxton added that “Kenya is obviously trying to get the internet speed up to a certain level to enable things like block chain and e-commerce”.

Interestingly, considering the impact infrastructural investment has on connectivity costs, Laxton remarked that Google was working on using drones to bring mobile hotspots to densified areas in underdeveloped countries. “It will hover above informal areas delivering data remotely. In other words there’s no need for infrastructure.” In addition, Amazon appears to have cottoned on to the potential of this idea by developing large aerial shipping stations where drones could switch off their

propellers and float in place with the aid of a built-in mini hot-air balloon. Add to this the 3m-square grid that a site like What 3 Words has designed for the world, and any person with a smartphone could make a purchase from any place in the world. Moreover, hubs are being developed where recipients could receive their goods. Also, the lack of personal bank accounts in some areas is being addressed by delivering e-coupons or digital tokens to people’s phones. “But the elephant in the room is cost. Availability and the speed of connectivity is one thing, but it remains to be seen how all of this could be affordable,” Laxton said. The elephant in the room is cost. It remains to be seen how all of this could be affordable. – Dennis Laxton