As South Africa continues to grapple with inflationary pressures and rising consumer expectations, the fast-moving consumer goods (FMCG) sector is undergoing a major transformation. From shifting purchasing habits and surging private-label confidence to the rise of collaborative logistics models and township retail expansion, the market is redefining how goods move from production to purchase.

CHEP South Africa, a leader in pallet pooling and supply chain logistics, is helping retailers, manufacturers, and distributors navigate this complex landscape driving operational efficiency, resilience, and customer-centric growth.

Consumers rewrite the rules: Value over volume

South African consumers are reassessing what value means in a constrained economy. With fuel price hikes and continued load-shedding impacting households, essentials have become the priority. According to Kantar (2024), the FMCG sector saw a 4.8% decline in sales value, while low-income households reduced spending by 11.8%.

Despite this, some categories remain resilient. Hygiene products such as toothpaste and hand wash, as well as small “comfort” items like ready-to-eat desserts, have maintained steady demand. Consumers are not merely cutting back; they are reallocating budgets to preserve balance between practicality and small indulgences.

The biggest growth story is in private labels, which have surged past R98 billion in sales, accounting for 18% of total FMCG value. Once viewed with skepticism, these products are now trusted by 75% of South Africans (NielsenIQ), signaling a decisive cultural shift toward affordability without sacrificing quality. Retailers have responded by expanding both essential and premium private-label lines, meeting the demand for high-quality, cost-effective options.

Logistics innovation: Pallet pooling powers operational excellence

While consumers adapt to their buying habits, logistics networks are evolving to meet rising efficiency expectations. Across Sub-Saharan Africa, CHEP’s pallet pooling model is proving pivotal in modernising supply chains.

Under this shared logistics approach, manufacturers rent, track, and recover pallets through CHEP’s centralised network reducing waste, lowering costs, and improving transparency. This system allows retailers and producers to optimise asset use and enhance sustainability while avoiding capital outlay on pallet ownership.

CHEP’s Pallet Recovery and Exchange Optimisation Project has become a leading case study in supply chain collaboration. By using Total Equipment Management Services (TEMS)—where CHEP manages the full lifecycle of pallet usecthe company has achieved a significant year-on-year reduction in pallets held at customer sites and improved turnaround times across networks.

“In a region where supply chain volatility is constant, our ability to maintain optimal equipment levels year-round gives customers flexibility to respond to seasonal peaks and unexpected demand surges without disruption,” said Trevor Drury, Senior Director of Sales at CHEP South Africa.
“By managing our own pine plantations and pallet production, we reduce reliance on external suppliers and protect our customers from material shortages.”

CHEP’s focus extends beyond hardware. “Our customers need more than just pallets—they need a system that adapts to their business,” added Abdul Hassim, Director of Customer Experience at CHEP South Africa.
“Our widespread hire and de-hire network keeps transport costs low, while our flexible pricing model based on actual usage allows customers to manage budgets more effectively. It’s about simplicity, flawless execution, and creating value at every touchpoint.”

Bridging logistics and retail: Expansion into underserved markets

CHEP’s supply chain evolution aligns with new growth strategies across South Africa’s FMCG retail network particularly in township markets, which now represent over R180 billion in annual turnover.

Once dominated by informal spaza shops, townships are fast becoming hubs for modern retail innovation. Retailers are introducing smaller pack sizes, localised marketing, and mobile sales networks to better serve these communities. Partnerships between formal retailers and informal traders are also increasing access and affordability.

Digital transformation is reshaping these markets. The adoption of mobile payments and Point of Sale (POS) systems is bringing greater traceability and data-driven decision-making to previously informal economies.

According to NielsenIQ South Africa, groceries and FMCG currently make up only 2% of total e-commerce sales far below the 17% global average but this gap signals enormous untapped opportunity. As online grocery platforms, subscription boxes, and WhatsApp commerce gain traction, digital retail is expected to reshape consumer engagement and distribution models in the next five years.

Sustainability and regulation: A new competitive frontier

Sustainability has emerged as a non-negotiable for both consumers and corporations. Nearly 60% of South African consumers say they are willing to switch to brands that demonstrate stronger environmental performance. Businesses are responding with recyclable packaging, lower-carbon operations, and responsible sourcing practices.

CHEP’s model is inherently sustainable its pooled pallets are reused and repaired rather than discarded, significantly cutting waste and emissions. The company continues to work with manufacturers and retailers to meet ambitious carbon-reduction and circular economy goals.

Looking ahead: Building resilience through partnership

South Africa’s FMCG sector is standing at a crossroads. The next wave of growth will not come from volume alone, but from smarter collaboration and integrated value creation. CHEP’s strategic partnerships, innovative logistics models, and customer-first approach position it as a key enabler of this transformation.

“We’re committed to co-creating the future of supply chains with our customers,” said Abdul Hassim. “By aligning our expertise with their goals whether in digital transformation, sustainability, or operational efficiency we’re helping them build resilient, future-ready businesses.”

As the industry moves toward 2026 and beyond, the companies that thrive will be those that balance profitability with purpose, efficiency with sustainability, and technology with human connection. CHEP’s ongoing work with manufacturers, retailers, and logistics partners across Sub-Saharan Africa demonstrates that innovation when built on trust and shared value can power growth for all.