Building South Africa’s next ecommerce powerhouse

The Foschini Group (TFG) is one of South Africa’s leading retail groups, and through its new technology division, TFG Labs, it is looking to become an equally prominent ecommerce player.

TFG Labs was launched earlier this year with the aim of building the largest, most reliable, and most profitable ecommerce destination on the continent.

This is a lofty goal considering it is competing with Naspers’ Takealot and JD Group’s Everyshop. However, there is good reason to take this business venture seriously.

TFG Labs is headed up by ecommerce heavyweights Claude Hanan and Luke Jedeikin, who built South Africa’s most successful online fashion retailer, Superbalist.

Through TFG, they have access to 29 retail brands that trade in fashion, value, jewellery, accessories, sporting apparel, cellular, homeware and furniture.

Armed with deep pockets through TFG and a country-wide network with hundreds of stores, TFG Labs has an excellent foundation to build from.

To make the most of these valuable assets, TFG Labs is investing heavily in its technology capabilities.

Hanan told MyBroadband to win at the omni-channel retail market, technology must become a core competency.

“In the same way traditional retailers don’t outsource core competencies like store operations, we believe we will build the best technology products in-house,” he said.

Flat Circle office
Flat Circle office

TFG Labs recently bolstered its in-house technology capabilities by acquiring Flat Circle — a specialist mobile app development agency based in Cape Town.

The acquisition brought the whole Flat Circle team into TFG Labs to reinforce the development of TFG’s new platform and architecture.

Hanan said they decided to acquire Flat Circle because they really liked the team and respected what they had built.

Another benefit is that Flat Circle is an “intact unit”. “We bought a team that can hit the ground running and immediately start building,” he said.

He highlighted that it is far more affordable to build your own team to do product enhancements and feature developments, which is an ongoing process.

Flat Circle’s initial work will be to rebuild the TFG app to place the full suite of TFG products and services in customers’ pockets.

“This includes our 23 store brands, 180,000+ products, rewards, financial services and value-added services,” Hanan said.

“Augmenting our strong physical retail presence, the mobile app will soon bridge the physical and virtual shopping worlds.”

TFG Labs’ has a particularly strong focus on mobile. This, Hanan said, is because mobile will become their dominant platform for ecommerce sales within the next two years.

“The majority of online sales in South Africa happen on mobile-web or via an app. The big unlock for TFG will be the omni-channel applications and the seamless merging of online and offline worlds,” he said.

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Building South Africa’s next ecommerce powerhouse