Cape Town-based click-and-collect company Pargo has entered Egypt after growing its pickup points to over 3 500 countrywide in SA.
Established locally in 2015, Pargo seeks to solve the challenges of last-mile logistics through its smart logistics platform and fulfilment solutions, which are anchored by a nationwide network of Pargo pickup points.
Since inception, it has grown to over 500 e-commerce clients that use its technology, including Edgars, Faithful to Nature, Rain, TFG, Cape Union Mart, Clicks and HomeChoice.
During a video interview, co-founder Lars Veul told ITWeb that after setting up a presence in Cairo, Pargo remains focused on growing its South African operations. It aims to further develop its technology and processes to make fulfilment solutions fit for the local logistics landscape, including home delivery, returns and micro-warehousing.
“We have recently launched operations in Cairo and the plan is to have the same business model there as we do in South Africa – where we partner with the e-commerce players and couriers. If the pilot goes well, we intend to fully establish operations there.
“We did a lot of research on the continent and we found that the e-commerce and courier landscape in Egypt is very similar to that of South Africa. They also have the same challenges of efficient last-mile delivery and this is where our opportunity lies.”
According to Veul, the goal in Cairo is to initially pilot with between 10 and 25 e-commerce companies in the African city, integrating its customisable API with their online shopping platforms.
Once that proves successful, there are plans to further expand its operations in the North African country.
Meanwhile, in SA, Pargo estimates its collection points now cover 87% of the country’s postal codes, and 45% of its customer base lies within township and rural areas.
Pargo pickup points are located in convenience stores across the country, including Freshstop at Caltex, selected Spar stores, Clicks and Lewis stores. It has established channel plugins, along with an investment in software and platforms to engage customers.
According to Veul, Pargo has an internal team of developers, which developed the more than 50 different types of dashboards, to ensure fast, secure and efficient delivery.
The dashboards enhance last-mile services through tracking the items to be delivered, and ensuring delivery takes place for end-users who are based even in remote areas, where there are no physical addresses – through partnerships with informal merchants and tuck shops.
Other metrics measured through the dashboards include customer satisfaction, order accuracy, delivery times,pre-shipping and delivery schedules.
“There are quite a lot of steps involved in getting a parcel from the warehouse to the customer’s hands. Our in-house tech team builds innovative dashboards to ensure we are 100% in control of what's happening, and we track the parcels all the way, and deliver a good service. Technology is central to this.”
Online retail in SA passed the R50 billion milestone in 2022, accounting for around 4.7% of the total retail market, according to the Online Retail in South Africa 2022 study conducted by World Wide Worx with Mastercard.
While SA’s e-commerce sector is still a young industry, there has been much significant growth, in a short period of time, presenting infinite opportunities to resolve some of the challenges associated with this rapid growth, notes Veul.
Pargo wants to get more South Africans, particularly those in the township and rural areas, to buy into the idea of ordering online and then picking up their order from a designated point.
“Despite the tremendous growth of e-commerce during COVID-19, South Africa’s e-commerce rate is still much lower than that of the rest of the world, which is sitting at between 15% to 25%.
“Our role is to ensure all South Africans see e-commerce as the viable alternative to brick-and-mortar shopping, and key to this is ensuring online shopping is more affordable, convenient and simple, as well as accessible.
“This is why we continue growing and ensuring economies of scale across the different markets, while providing consolidated deliveries to pickup points. By doing this, we want to ensure we are an enabler of e-commerce growth in South Africa,” concludes Veul.
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