Dis-Chem, the leading pharmacy group in South Africa, has experienced a massive shot in the online arm thanks to the implementation of smart logistics technology. Since adopting Picup’s software in March 2020, the company has grown its delivery orders from between 6000 to 8000 a month to, at the height of Covid-19, around 89 000 orders.
While some consumers have returned to physical stores to browse and buy, Dis-Chem’s online orders have remained strong, pointing to significant growth in its eCommerce offering both now and in the future.
Annemarie Barnard, IT OPS Project Management Officer, comments: “In August 2021, we saw online sales growth of 14,4% over the comparable period and this was already an increase in growth over the 2019 comparable period where we saw 345,9% growth.”
“While Covid-19 was the catalyst for the change in consumer behaviour, Dis-Chem’s logistics has become extremely slick. We are seeing a reduction in delivery times from 7 – 10 days to same or next day. This has radically decreased customer complaints over the past 2 years,” says Barnard.
A great enabler of Dis-Chem’s ability to service its eCommerce customers faster has been Picup, a subsidiary of Karooooo. This smart logistics technology is plugged into the Dis-Chem system through API integration and enables the pharmacy group to dispatch online dispensary, frontshop and telephonic orders faster.
Given the increasing demand from consumers for quicker delivery times for digital purchases, this was a game changer for the pharmacy group in its mission to remain competitive.
“Our customers don’t want to wait for their goods, they want them as soon as possible after pressing pay. They also want to know when their parcel will arrive. By using Picup’s technology, our customers are able to track their parcel and arrange their availability around its delivery,” says Barnard.
“Communication is key in the online space to ensure that customers remain informed and ensure greater customer satisfaction.”
Dis-Chem dispatches both over the counter goods and prescribed medication using Picup’s delivery fleet, together with its own 260 Dis-Chem drivers, to ensure faster and accurate delivery across the country. This is managed through 192 Dis-Chem, 6 Medicare and 35 Baby City strategically designated stores, all active on the Picup platform.
Picup CEO Antonio Bruni says advancements in healthcare logistics is happening at a rapid pace around the world as more consumers opt in to order online rather than go in-store. “This has meant that brands have had to step-up their eCommerce game, very quickly, in order to meet the growing demand – and stay competitive.”
“Increasing from 8000 to almost 89 000 orders a month is a massive jump, and is something we are very proud to have been a part of. Without adequate logistics management capability this rapid increase could have resulted in poor customer brand experience for Dis-Chem. Given that it is every retailer’s goal to grow in the online space, adopting the right smart logistics technology that will allow them to rapidly scale their delivery experience is key,” he adds.
Decentralising its delivery nodes – up from 20 to 80 nationally distributed hubs – has greatly advanced Dis-Chem’s eCommerce service. This has allowed Dis-Chem to shorten its lead times in the processing of orders as well as delivery times.
“By decentralising its distribution operations to now have a presence around the country, Dis-Chem has uniformed its processes across the Group; every store adopts the same process which enables scalability, a faster delivery process and dispatch of orders,” says Bruni.
Further, by using real-time geographical data, Dis-Chem has expanded its hub strategy, “as we know where our volumes are coming from. This has streamlined our operations as we can now map out our distribution strategy,” adds Barnard.
The trend towards e-commerce is set to continue as consumers become more comfortable with online shopping, payment security and improved service.
In 2021, MasterCard reported that 68% of consumers now shop online. This is a significant increase, and is being driven by a shift in consumer behaviour as well as the response from retailers in how they service this demand.
“Not everyone gets it right, and delivery times remain among key reasons why consumers abandon a sale at the virtual till point. By reducing wait times, brands are seeing increased sales and market share. Dis-Chem is a prime example of this,” concludes Bruni.
It’s clear that the future of online shopping lies in the hands of the logistics solutions that brands choose to use. With a plethora of new service providers now available, such as Picup, which make use of real-time data to drive their delivery models, customers’ needs are being heeded to.
But it will take a while for last-mile experiences across the board to improve in line with increasing customer demand – and which, if they get it wrong, can cost these service providers and brands the end sale.
