Growing African demand for electronic shelf labels
May 3rd 2012, 15:44
The latest expansions into Zimbabwe and Swaziland meet the burgeoning demand for ESL systems throughout the rapidly growing African retail market and complement Skydirect's existing operations throughout South Africa, Botswana, Namibia and Mozambique
“Although it is only in the early stages of growth the rest of the African market has so far accounted for 100 000 labels, most of them in the last 12 months,” says Hendrik Bredenkamp, MD of Skydirect. “I have signed partnership agreements with local companies in Southern African countries to handle, for example, the Zimbabwe market where the economy has stabilised on the use of the US dollar. I am also exploring opportunities in the Indian Ocean islands market.”
Skydirect is an XON company and Pricer's exclusive African partner for its electronic shelf labels (ESL), has expanded its African footprint into two new countries, bringing the total to six.
Bredenkamp says the retail market is becoming extremely competitive in Africa, especially now that most of the larger retailers like Shoprite, Pick n Pay, and now Walmart are expanding into this challenging but lucrative environment where they face logistical issues and currency and inflation fluctuations that adversely affect pricing.
Bredenkamp says customers in Africa have a different profile and wallet than what South African retailers are accustomed to. For example, they are cash buyers and price sensitive, so will hunt down low special deals. The shopping basket is smaller but the number of baskets is far greater than in South Africa. That is why retailers in Africa are competing for the same wallets with regular price promotions trying to get more feet through their stores. Other retailers have to react quickly or lose out which is why ESL is an ideal solution to cope with fast, quick and accurate pricechanges.
“ESL systems have become the natural choice for retailers looking to rapidly recoup their investment, then begin to improve margins and become more competitive while simultaneously gaining the flexibility they need to adapt in uncertain markets,” says Bredenkamp.
ESL systems replace paper and adhesive shelf labels with LCD price tags. They eliminate manual pricing, which eliminates error and reduces labour intervention. Since the prices are set on the computer and distributed via two-way infrared communications, with up to 90 000 price changes possible every hour, ESL systems are rapid, flexible, and accurate. They enable swift deployment of promotional pricing and frequent changes as suitable for the retailer. Prices can be set at the head office and pushed down to the shelves or from the retailer's office on site. The ESL shelf talkers can store and provide up to 32 parcels of information that help retailers to manage their inventories. Never being out of stock ensures shelf space is maximised and therefore profitability too.
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