Uber launches medicines delivery service in South Africa

JOHANNESBURG (Reuters) – The South African unit of Uber Eats expanded its delivery offering on Thursday and launched an app-based over-the-counter drug service to gain market share in the fast-growing online shopping sector in Africa’s most industrialized economy.

Uber Eats, a unit of the US hail protection service Uber Technologies, already has a lion’s share of the South African market for shipping groceries valued at $ 600 million.

The equally lucrative drug delivery market is controlled by pharmacy chains Clicks and Dis-Chem, which offered delivery services long before COVID-19 sparked a shift to online shopping.

Analysts say such first movers, including Naspers’ Takealot, have a natural advantage over newbies, especially as users increasingly want to use fewer smartphone applications to do more things.

However, Uber Eats is using a “marketplace” strategy – combining hailstorms, grocery deliveries and other services in a single mobile app that already has over 2 million users in the country, it said in a statement.

The latest foray into the delivery area is in collaboration with the local health group Medicare, which operates more than 50 clinics and pharmacies across the country and enables its app users to purchase over-the-counter medicines.

“The nationwide lockdown and restriction on movement created an immediate need to accelerate our business to improve access to essentials,” Shane Austin, general manager of Uber Eats South Africa, told Reuters.

“This is one of the reasons why we have focused on including various other retailers in addition to restaurants in the app.”

In its latest Digital Market Outlook, the information portal Statista forecast an annual growth of 11% for the South African e-commerce market through 2024, with the number of online shoppers growing from around 25 million at present to almost 37 million.

Reporting by Mfuneko Toyana; Arrangement by Emelia Sithole-Matarise

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