Innovation, energy, and retail strategy during the current electricity crisis

The Central Bank estimates that the electricity crisis is costing the country around R900 million a day. One of South Africa’s biggest retailers is spending around R3.56 million a day to overcome the burden of load-shedding, and consistent power interruptions are severely impacting logistics, cold chain storage, and retail growth. This has led to a shift in how retailers approach the energy conversation, with leaders taking an innovative stance that allows them to overcome the challenge.

One thing is clear: the retail sector in South Africa is fighting for its customers. From Shoprite to Dis-Chem, Pick n Pay, and Takealot, retailers are putting their feet firmly on the road to creating value for their customers and resilience within their infrastructure. While alternative energy solutions are the most obvious choice for companies, there is also a focus on how digital tools can disrupt the current situation and open up new opportunities for retailers.

Where do companies start if they want to build resilience? The cloud. No longer hype and complexity, the cloud has become synonymous with agility and flexibility. It provides a trusted repository for retailers’ information and data. This allows them to store their information properly, regardless of power fluctuations, and to access this data for relevant insights that can be used for informed decision-making. For example, which times are most likely to see significant consumer footfall versus load-shedding schedules, and then acting on this data to ensure that outlets have sufficient power and resources to best serve customers. 

These insights can also be used to enhance marketing strategies and drive customer engagement, potentially increasing sales and traction at a time when retailers need it the most. Offsetting the cost of alternative energy sources and staying ahead of load-shedding is a priority for most retailers – the price tag is too high to ignore. Using data to build a customer base and drive profit margins is an innovative way of embedding sustainability into the very fabric of the business.

That said, it is as important to recognise the risks of digital within this environment as it is to take advantage of the benefits. Security has to be a priority, particularly within a fluctuating power environment, as does consistent service delivery. You want to ensure that your business can leverage the technology to achieve clear strategic goals, but not be left carrying the can if it is hacked or if customers can’t access the service because the infrastructure isn’t capable of handling the load. 

The latter can be felt if connectivity isn’t correctly installed or the right connectivity solutions aren’t implemented for the use cases. Satellite, for example, may need landlord permission while fibre requires extensive groundwork to get up and running. And connectivity is critical to the success of any technology architecture, especially cloud. The key is to focus on how digital can enhance the business within realistic parameters that are aligned with existing infrastructure and capabilities.

South African retailers have already proven incredibly resilient. Taking digital steps towards developing innovative solutions that enable them to optimise their alternative power investments, better manage customer expectations, build loyalty and drive engagement, is only one part of the puzzle. The other is made up of the sheer grit that defines every organisation in the current landscape. Retailers are finding solutions that lift their reliance on the grid, building customer experiences that uplift them from the complexities of power poverty, and finding new ways of keeping the lights on, no matter what.