Massmart, owner of Game and Builders, has reached an agreement to buy 87.5% of privately owned grocery delivery company OneCart, it said in a Sens announcement on Wednesday.
Massmart wants to beef up its e-commerce offering, and OneCart, which delivers goods to consumers from multiple stores, including Pick n Pay and Woolworths.
Massmart's Sylvester John said: “We are excited by the opportunities that this acquisition presents. E-commerce continues to grow rapidly, both in SA and for Massmart, contributes up to 3-4% participation in overall retail sales.”
“We don’t expect this growth trend to change and have embarked on implementing the fundamental building blocks required for a strong ecommerce offering. This includes, but is not limited to, on-demand retail.”
There has been an exponential rise in e-commerce since the Covid-19 pandemic struck, forcing retailers to be agile in boosting sales amid the decline in foot traffic at physical stores and forcing reticent consumers to adapt to online shopping.
Massmart has underinvested in online shopping and faces competition from Naspers-owned Takealot, but it is trying to catch up under CEO Mitchell Slape with a plan to use its wide network of stores as delivery sites.
“It is our intention to maintain and grow the diverse and competitive retail composition of the OneCart platform while also investing significantly in the underlying technical platform, in-store picking processes and last mile distribution toward further enhancing the customer experience. We look forward to supporting and learning from the team at OneCart and expanding our ability to serve customers more effectively,” said John.
Last year Massmart appointed Walmart’s US-born John to head up online commerce. He was instrumental in leading online delivery from more than 3,000 stores in the US to consumers.
Massmart is also revamping its logistics capabilities to ensure distribution centres are equipped to handle smaller or individual e-commerce orders which require moving a few items from shelves, as well as to deal with large orders which use different equipment to move huge pallets of goods.
It said closure of the OneCart transaction will be dependent on finalisation of “customary final approvals and suspensive conditions”.
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