Retail group TFG buys delivery app Quench to bolster omni-channel

SOUTH AFRICA – TFG, a leading retail group in South Africa, through its tech division TFGLabs, has acquired digital shopping platform and last-mile delivery provider Quench.

Quench provides same-day delivery of groceries, food, medication and alcohol via its mobile app to customers in major centers across South Africa.

According to the fashion retail giant, the acquisition forms part of TFGLabs’ ambition to become SA’s next e-commerce powerhouse.

TFG, formerly known as The Foschini Group, has been investing heavily in expertise and technical capabilities over the last year and has earmarked R500 million (US$31.2 million) over the next three to five years to expand its digital capability.

In June 2021, the retailer launched its TFGLabs technology division, in a move to attract the continent’s best tech talent and use the latest technologies to create a seamless mobile shopping experience.

The Quench acquisition will enhance the company’s existing delivery capabilities across the fulfillment network through proprietary software and engineering, bringing a scientific approach to planning, least-cost routing, and asset utilization, noted the retailer.

“With this acquisition, we gain access to fast, reliable delivery across South Africa, whilst achieving superior delivery unit economics,” said Claude Hanan, co-head of TFGLabs.

“With 75% of orders currently fulfilled from stores, Quench’s network of micro-carriers will become an essential enabler for our ‘ship-from-store strategy. All international market data shows that delivery price, reliability, and speed are highly correlated to e-commerce penetration and purchase frequency.”

TFG has over 4,300 outlets in 26 countries on the continent, and employs more than 34,800 people, with over 26 million customers in South Africa.

“With this acquisition we gain access to fast, reliable delivery across South Africa, whilst achieving superior delivery unit economics”

Claude Hanan, co-head of TFGLabs Tweet

The retailer’s online shopping app, myTFGworld.com, consolidates its retail partners, which include Totalsports, @home, @homelivingspace, Markham and Exact.

“For now it’s business-as-usual at Quench,” said Hanan.

“We will continue to service Quench’s existing partners and customers, and in fact immediately invest in improving our offering and service to both.”

In August 2021, the fashion retail giant posts a Q1 online shopping turnover growth of 23.2%, with its e-commerce revenue contributing 9.8% to total group turnover.

Fashion retail chain TFG Africa said it maintained steady business performance in the first quarter of 2021, with online shopping turnover growth of 23.2% compared to Q1 2020.

In the group’s trading update for Q1 2022, TFG says cash turnover for TFG Africa grew 55.5%, compared to Q1 2021.

Like-for-like turnover growth for TFG Africa of 11.1% was reported for May and June 2021, compared to May and June 2020.

Its e-commerce revenue contributed 9.8% to total group turnover, as more customers have taken to online shopping channels since the onset of the COVID-19 pandemic.

According to the statement, TFG Africa opened 71 new stores during the quarter, while 29 stores were closed.

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