U.S. Markets close in 2 hrs 16 mins

Uber launches medicines delivery service in South Africa

Mfuneko Toyana
·2 min read
FILE PHOTO: A flyer advertising Uber Eats delivery service is pictured at a restaurant in Cape Town

Uber launches medicines delivery service in South Africa

FILE PHOTO: A flyer advertising Uber Eats delivery service is pictured at a restaurant in Cape Town

By Mfuneko Toyana

JOHANNESBURG (Reuters) - Uber Eats' South African unit on Thursday expanded delivery offerings, launching an app-based over-the-counter medicines service as it seeks to claw market share in the fast-growing online shopping sector in Africa's most industrialised economy.

Uber Eats, a unit of U.S. ride-hailing service Uber Technologies already has a lion's share in South Africa's $600 million food dispatching market.

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

Analysts say such "first movers" including Naspers- owned Takealot, have a natural advantage over newcomers, especially with users increasingly seeking to use fewer smartphone applications to do more things.

But Uber Eats is banking on a "marketplace" strategy - combining ride-hailing and grocery deliveries and other services on a single mobile phone app that already has over 2 million users in the country, it said in a statement.

Its latest foray in the delivery sector is in partnership with local health group Medicare, which operates more than 50 clinics and pharmacies around the country, and will allow its app users to purchase over-the-counter medication.

"The nationwide lockdown and restriction in movement created an immediate need to accelerate our business in increasing the accessibility to daily essentials," general manager of Uber Eats South Africa Shane Austin told Reuters.

"Which is part of the reason our focus has been towards on-boarding various other merchants onto the app, aside from just restaurants."

In its latest Digital Market Outlook, information portal Statista predicted South Africa's e-commerce market would see annual compound growth of 11% up to 2024, with the number of online shoppers growing to nearly 37 million from around 25 million currently.

(Reporting by Mfuneko Toyana; editing by Emelia Sithole-Matarise)