MaxiPost (MXP Group) is opening a representative office in Africa. It is the first Russian courier service to enter the African market. The company has opened its first office in Nigeria, to be followed by branches in South Africa and Morocco. As in Russia, MXP will mainly focus on courier delivery for online stores (last mile delivery), both local and trans-border (from China).
Africa is the second region in MXP’s international expansion. The company opened its first foreign branch earlier this year in Guangzhou, China. MXP headquarters is based in Limassol, Cyprus. Unlike the Chinese expansion model where the company acquired a local logistics platform and specializes in consolidating and shipping packages from China worldwide, the offices in Africa will be opened based on a traditional model, after a thorough research into the local retail and logistics market.
Company owner and board chairman Denis Ivannikov explained the choice of a new region by a big e-commerce potential of a number of African countries.
For example, the Nigerian online retail market is worth $12 bln and, according to McKinsey, will reach $75 bln by 2025. The country is home to 40% e-commerce startups in Africa. Similarly, in South Africa 54% of the population are internet users and 69% have bank accounts. In Kenya, where another MXP office might open, it is 79% and 82%, respectively. Moreover, due to the M-Pesa payment system, online payments are widely used there, which stimulates cross-border shopping.
“Courier services do not look very developed against this backdrop,” Ivannikov says. “People have money, their buying power is high, but logistics leaves much to be desired and it is an obstacle to shopping. There is also not much trust to courier delivery and online shopping. So we have something to offer to African online shoppers, our 18-year experience can be useful here.”
The company plans to offer storage, sorting, pre-assembling, pay on delivery, partial purchase, return, fitting and other business processes and services in Nigeria and then in other African countries.
To reduce losses, MXP is going to use HR technology, including its own methods to select, train, motivate and control personnel.
After settling in Nigeria, South Africa and Morocco, the company plans to expand its presence on the African continent in Algeria and Kenya, and take 1%-4% of local logistics markets in 2-3 years.
By Konstantin Frumkin