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Online grocery store uses trucks and tuk-tuks for same-day deliveries in rural KwaZulu-Natal

South Africa's first rural-centred online grocery store and delivery service has navigated degraded roads and rough terrain to complete more than 25,000 orders in KwaZulu-Natal.

Luke Daniel | Business Insider SA

Online shopping and food delivery services have boomed over the past two years, driven by the Covid-19 pandemic, which kept people at home.

South Africa's brick-and-mortar retailers, like Shoprite and Pick n Pay, have grown their delivery home-delivery services. Fast food delivery giants, Uber Eats and Mr D, are expanding to other areas as demand grows. Similarly, Takealot, the country's biggest e-retailer, recently reported increased sales, with overseas competitor, Amazon, now eyeing the South African market.

And although these e-commerce services are growing, there are still large areas of the country left unserved by the major companies.

Townships across South Africa are regularly overlooked by these e-commerce giants, leaving the market open to innovative local entrepreneurs. Rural parts of the country, home to roughly a third of all South Africans, are also ignored. But the demand for e-retailer convenience is there, as proven by an online store and delivery service started in Eshowe, KwaZulu-Natal, shortly before the Covid-19 pandemic hit.

"I grew up in rural Eshowe, and my grandmother was an entrepreneur. She owned a local spaza store," Siyanda Mthethwa, the 36-year-old founder of Kuloola, tells Business Insider SA.

"Working in that spaza store was my first job. So, I always grew up around a family of entrepreneurs, and it clearly rubbed off on me and had a big impact on my life."

Mthethwa's first experience with an online grocery store was in 2017, while he was staying with his wife in Norway. "It was an absolute game-changer in terms of convenience."

"I actually thought about how impactful this would be back home, where I come from because we spend so much money going to towns, standing in queues, paying for a bus or taxi," says Mthethwa.

"So, it was quite a painful experience going shopping, and I thought that I could actually export this level of convenience back to South Africa."

But compared to urban delivery services in Norway and back in South Africa, servicing the rural market posed significant and complex challenges. Chief among these challenges is the lack of formal addresses for households in rural villages.

"It's very difficult to reach the doorstep of each household without being able to navigate. I spent about two years working with friends in the tech space in Norway, and we developed a mapping technology that allows us to map rural households and issue them with a delivery number and to be able to do that at scale," says Mthethwa.

In partnership with the local municipality and tribal authorities, Mthethwa began mapping more than 50,000 households in Eshowe and its surrounds. This technology could one day extend beyond grocery delivery services, says Mthethwa, and be used by emergency services.

Once these rural households had been issued with delivery numbers, addressing the critical issue of navigation, Mthethwa started Kuloola, as a pilot project, in July 2019. Mthethwa rented a delivery vehicle, hired a driver, and sourced inventory, all whilst still living overseas.

"It's extremely difficult to have groceries delivered to your doorstep. It's equally difficult to get stock delivered to your tuckshop. So, we wanted to provide something that makes your life easier [and] Kuloola is a Zulu term which basically means easy," says Mthethwa.

After the pilot project proved to be an "enormous success", Mthethwa launched the business, in full, in early 2020, mere months before the Covid-19 pandemic hit South Africa. And while other industries languished under the pandemic and its associated lockdown restrictions, e-commerce, including the recently launched Kuloola, boomed.

"We knew we had a business, pre-pandemic," says Mthethwa.

"And then when the pandemic hit, there was a huge demand for the delivery of groceries, particularly to rural communities, who usually stack up in taxis or vans in crowded spaces."

Within its first two years servicing households and spaza shops within KwaZulu-Natal's uMlalazi Municipality, Kuloola completed more than 25,000 orders. Today, Kuloola has more than 5,000 household customers and delivers to more than 200 spaza stores, with a customer return rate above 80%.

A delivery fee of R50 is payable for household orders under 100kg. Bigger orders incur a delivery fee of R100, and Spaza shops pay a flat fee of R50 per delivery. These orders are delivered by Kuloola's five Hyundai H100 trucks, which carry up to 15 deliveries each per trip, and are completed on the same day if ordered before 12:00.

Understanding that rural communities are less likely to have the high internet penetration rates seen by their urban counterparts, orders can also be placed through Kuloola's call centre or even by sending free 'please call me' texts to which the delivery service will respond.

Local deliveries in and around Eshowe are charged at R20, and groceries are transported by Kuloola-branded tuk-tuks. These orders are usually delivered within two hours.

"We have two tuk-tuks for the more local, closer deliveries, for a quicker turnaround and fuel efficiency," adds Mthethwa.

Hiring local delivery drivers has also been a key element of Kuloola's success. With already poor rural roads made even worse by the recent flooding in KwaZulu-Natal, these drivers, with an innate understanding of the area, are keenly aware of the hazards and know how to bypass them.

"We use local drivers who come from the respective villages, so they know the roads, what they look like, and if there should be a shortcut when they navigate to a specific household," says Mthethwa, adding that Kuloola employs 24 staff, including drivers.

"We've also managed to carry so much money without any robbery over the past 24 months, and that is purely because of our cultural understanding of the communities that we serve."

Mthethwa hopes to grow the business by partnering with major retailers in other areas, realising, in the wake of the devastating July unrest which tore through parts of KwaZulu-Natal and Gauteng, that warehousing stock was a bad plan.

Kuloola hopes to gain some seed funding towards the end of the year, which it will use to optimise its technology, including improving its dispatch and navigation systems.


Read more | Original article 

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