Building Materials and Hardware Retail

A Customer Who Spends R200,000 Building a House Over 12 Months Is One of the Most Valuable Customers in All of Retail. Do You Know Who They Are?

A 3-minute assessment that scores your readiness to identify, reward, and retain your most valuable customers. Built around a three-layer model that has already been proven in adjacent retail categories. Designed for executive decision-makers in building materials.

322
Stores across 5 countries
R11.5bn
Revenue FY2025
R729
Avg basket (down from R737)
5.8%
Transaction volume growth

What You Will Get

  • A score across 5 dimensions: Identity, Segmentation, Lifecycle, Funding, Delivery
  • Your weakest area identified with a specific recommendation
  • Deep dives on your two biggest gaps with worked examples
  • Building materials benchmarks from Dis-Chem Better Rewards and retail banking partnerships
  • A clear next step based on your budget and readiness

What this assessment measures

In October 2025, Dis-Chem replaced its 23-year-old loyalty card with Better Rewards. The mechanic was simple: supplier-funded instant discounts at the till. In 17 weeks, retail revenue grew 10.4%, 550,000 new shoppers walked in, and participating brands saw volume growth of 20.9%.

The mechanic transfers to building materials. The economics are the same. Suppliers fund the discount in exchange for measurable access to identified buyers. But the customer behaviour is completely different. Dis-Chem customers visit weekly and buy consumables they will replace next week. Building materials customers visit monthly over a 12-18 month project and buy things they will never buy again. That difference changes everything about how you design the programme, how you fund it, and how you measure it.

This assessment scores your readiness across five dimensions: Identity, Segmentation, Lifecycle, Funding, and Delivery. Each one maps to a specific layer of the programme model.

AM
Founder, TUZO | Africa's Lifestyle Rewards Platform
Question 1 of 11
Identity

What percentage of your total transactions can you connect to an identifiable, contactable customer?

Dis-Chem's Better Rewards works because every member swipes a card. That swipe creates an identity. Without identity, there is no data, no segmentation, and no way to measure whether a programme is working. In building materials, the majority of customers pay cash and leave anonymous.

We do not track this. Most sales are anonymous cash transactions.
Less than 20%. Some customers have payment cards or accounts, but there is no unified view.
20% to 50%. We can identify some customers, but the majority of transactions are anonymous.
Over 50%. We have a system that captures most customer identities at the point of sale.
Identity

If you wanted to send a message to every contractor who has spent over R50,000 with you this year, could you?

Contractors are the highest-value customers in building materials. They visit frequently, buy in volume, and influence which brands get specified on projects. But if you cannot identify them, you cannot reward them differently from a weekend DIYer buying R200 of paint.

No. We do not know who our contractors are or what they have spent.
We could identify a handful through trade accounts, but not at scale.
We could reach a meaningful segment, but it would require significant manual effort.
Yes. We have the segmentation, contact details, and channel to reach them within hours.
Segmentation

Can you distinguish between a homeowner building in phases, a bakkie builder doing jobs for clients, and a retail DIY shopper?

Average basket size dropped from R737 to R729 in FY2025. The driver was a shift in customer mix, more retail shoppers, fewer bakkie builders. That is not a pricing problem. It is a visibility problem. If you cannot see the mix shifting, you cannot respond to it.

No. Every transaction looks the same regardless of who the customer is.
We have informal knowledge at store level, but nothing systematic.
We can separate trade accounts from retail, but do not track behaviour patterns within each group.
We segment by customer type, track frequency and spend patterns, and can offer different value to each.
Segmentation

Do you offer anything different to a customer who spends R250,000 a year compared to one who spends R2,000?

In Dis-Chem's model, every member gets the same base discount. But the Capitec banking layer adds extra value for a specific segment. Building materials needs a different kind of tiering. A contractor spending R250K a year is a fundamentally different customer from a weekend DIYer. Treating them identically means under-serving the one who matters most.

No. All customers are treated identically regardless of spend.
High-spend customers might get informal recognition at store level, but nothing structured.
We have a basic tiering or account system that offers some differentiation.
We have defined spend thresholds with escalating benefits and structured recognition for high-value customers.
Lifecycle

When a customer finishes buying foundation materials, does anyone at your company know they are about to need bricks, then roof trusses, then plumbing?

This is the fundamental difference between building materials and pharmacy. Dis-Chem customers replenish. They run out of something and buy it again. Building materials customers progress. They move through project phases over 12-18 months. If you lose them at phase three, a competitor gets phases four through twelve.

No. We have no visibility into where a customer is in a building project.
We might notice patterns at store level, but there is no system tracking project stages.
We can see purchase sequences for some customers, but we do not act on them.
We track project milestones and proactively reach out with relevant offers for the next phase.
Lifecycle

What happens after a customer completes a purchase and leaves the store?

In Dis-Chem's model, the customer comes back naturally within a week because they consume what they bought. In building materials, the gap between visits might be four to six weeks. That gap is where customers defect. If there is no communication between visits, the next trip goes to whichever store is most convenient or top of mind.

Nothing. They leave and we have no way to follow up.
We have a savings card they can top up, but no triggered communication after a purchase.
We send some generic promotions to customers who have opted in.
We send personalised follow-up based on what they bought, timed to when they are likely to need the next category.
Funding

Do your building materials suppliers contribute funding toward customer-facing rewards or incentives?

Dis-Chem's programme is self-funding. Over 170 brands co-fund the 10% discount because they get measurable access to identified buyers. Building materials suppliers like PPC, AfriSam, Duram, and Harvey compete just as fiercely for preference. The difference is that in pharmacy the co-funding buys weekly basket frequency. In building materials, it buys specification loyalty. Once a builder starts with PPC, they finish with PPC. That is worth funding.

No. We fund all promotional activity ourselves.
Some suppliers contribute to occasional catalogue or in-store promotions.
We have a few structured co-funding arrangements with key brands.
Suppliers co-fund a significant portion of customer rewards through a formal programme and we can measure the return for each brand.
Funding

How does your banking partner relationship work in terms of your customer programme?

Capitec gives its cardholders 1% cashback at Cashbuild. African Bank gives 1.5% in Audacious Rewards. Both banks own the data, own the relationship, and brand the reward as theirs. Dis-Chem flipped this model. When a Capitec cardholder pays at Dis-Chem, they get an extra 5% off branded as part of Dis-Chem's programme. The reward lives inside the retailer's world, not the bank's.

We have no banking partner relationship linked to customer recognition.
A banking partner rewards their cardholders for shopping with us, but the reward is branded as the bank's and we do not see the data.
We co-brand some promotions with a banking partner and share limited data.
We have a structured partnership where rewards are experienced as part of our programme and we share the customer insights.
Delivery

How quickly does a customer see value after completing a qualifying purchase?

The reason the Dis-Chem till slip works so well is speed. The customer sees "AfriSam discount R146.95" while they are still standing at the counter. The saving is real, visible, and immediate. No points to accumulate. No voucher to come back for. No app to download. That instant gratification is what creates the card-swipe habit.

There is no immediate value. Promotions are price-based or draw-based with delayed outcomes.
Rewards require a separate redemption step like visiting a website or calling a number.
Some rewards are instant at the till, but most are delayed or require additional steps.
Value is visible at the point of sale, on the till slip or via WhatsApp within minutes. No friction. No waiting.
Delivery

Could your current systems run a programme across all stores that identifies customers, applies instant discounts, tracks supplier-funded benefits, and reports results by brand?

Dis-Chem's Better Rewards runs across 260+ stores with a unified system. Every swipe, every discount, every brand is tracked and reported. For building materials, the system needs to do the same thing but also handle project lifecycle tracking, contractor tiering, and banking partner integrations. That is a different level of complexity.

No. Our promotions are manual, store-by-store, or supplier-led with no unified tracking.
Possibly, but it would require significant coordination and manual effort.
We have some digital infrastructure, but not a unified system at that scale.
Yes. We have systems that can trigger, track, and report rewards at scale across all stores with real-time reporting by brand.
Budget

What is your approximate annual budget for loyalty, rewards, or promotional activity?

This helps us tailor recommendations. A supplier co-funded model significantly reduces the retailer's own cost because the brands fund the customer-facing discount. The retailer's investment is primarily in the technology, the partner management, and the programme design.

We do not have a budget for this yet
Under R1 million
R1 million to R5 million
R5 million to R20 million
Over R20 million

Almost there.

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out of 40

What the Data Shows About Building Materials Rewards

10.4%
The Dis-Chem Proof Point

When Dis-Chem launched Better Rewards in October 2025, retail revenue grew 10.4% in 17 weeks. 550,000 new shoppers entered the brand. Participating brands saw volume growth of 20.9%. R410 million was returned to customers, on track for R1.5 billion in year one. The mechanic was simple: supplier-funded instant discounts at the till.

The mechanic transfers to building materials. The economics are the same. Suppliers fund the discount in exchange for measurable access to identified buyers. But the customer behaviour is fundamentally different. Pharmacy is replenishment: buy, consume, repeat weekly. Building materials is progression: buy foundation, then walls, then roof, then plumbing, over 12-18 months. You do not need to drive weekly frequency. You need to own the project.

R729
The Shrinking Basket

Average basket dropped from R737 to R729 in FY2025. The cause was a shift in customer mix. More retail shoppers. Fewer bakkie builders. Transaction volumes grew 5.8%, which is healthy. But volume growth from smaller baskets is less profitable than the same revenue from fewer, larger baskets.

A programme that identifies bakkie builders and contractors, recognises their cumulative spend, and rewards project milestones would give high-value customers a reason to consolidate at one retailer instead of splitting across Cashbuild, Builders, and Build It. That consolidation is where basket size recovers.

0
Own Programme. Own Data. Own Relationship.

Capitec gives its cardholders 1% cashback at Cashbuild. African Bank gives 1.5% in Audacious Rewards. Both banks benefit from the foot traffic. Both banks own the customer data. Both banks own the relationship. The customer thanks Capitec, not Cashbuild.

Dis-Chem showed how to flip this. When a Capitec cardholder pays at Dis-Chem, the extra 5% is experienced as part of the Dis-Chem programme. The customer swipes the Dis-Chem card. The saving says "Better Rewards" on the slip. The bank co-funds, but the retailer owns the moment. Building materials needs the same inversion.

20.9%
What Suppliers Are Willing to Fund

In the Dis-Chem model, over 170 brands co-fund the discount because they get something they cannot get anywhere else: direct, measurable access to identified buyers. PPC and AfriSam compete fiercely for contractor preference. Currently, neither brand can see who is buying their product at which store, how often, or in what quantities. A supplier co-funded programme gives them that visibility.

The co-funding value proposition is different though. In pharmacy, suppliers buy weekly frequency. In building materials, they buy specification loyalty. Once a builder starts a project with PPC cement, they finish with PPC. The brand that gets specified at foundation stage owns the entire project. That specification moment is what building materials suppliers would fund.

R200K+
The Lifetime Value of a Build

A homeowner building a two-bedroom house through a programme like Zakhelikhaya might spend R200,000 over 12-18 months. Foundation, walls, roof, plumbing, electrical, finishes, paint. That is 12-18 separate purchase occasions. If a competitor captures the customer at visit four, they keep them for visits five through eighteen.

But the value does not end at the build. That same homeowner will maintain, extend, and improve that property for decades. The Zakhelikhaya customer is already in the store. The payment card is already in their hand. The question is whether a programme connects today's R3,000 cement purchase to next month's R5,000 in bricks, next year's room extension, and the referral to a neighbour who is about to start building.

AM

Amani Mnkeni

Founder, TUZO

Africa's Lifestyle Rewards Platform. 10,000+ reward partners across 23 African countries plus UK and UAE. Clients and pilots include MSD, Vodacom, MTN, Lactalis, Safaricom, and ABSA.