Takealot Group CEO Mamongae Mahlare said the potential launch of an Amazon marketplace in South Africa in 2023 is a “compliment” to Takealot and its customers.
In an interview with The Money Show by Bruce Whitfield on Talk 702Mahlare appeared to credit Takealot for Amazon’s interest in South Africa.
“It’s a big compliment to Takealot and the people who have built this business to where it is today, and to our customers in South Africa who have supported this growth,” said Mahlare.
“It demonstrates that we’ve built something that has built a good enough investment case that global companies like Amazon want to come here.”
But Whitfield wondered if Takealot’s majority investor – Naspers – would be prepared to enter a “digital war” with the global commerce giant given that Takealot was not showing the same level of growth as its business in other countries. other regions.
After more than a decade in business, the dominant South African online retailer has yet to achieve profitability.
Mahare maintained that Naspers had invested in Takealot for the long term and had a long-term view of the company’s potential.
Amazon’s imminent arrival in South Africa has been rumored for 12 years.
However, several developments over the past few months strongly suggest he is finally pulling the trigger on such a move.
MyBroadband learned for the first time that Amazon was looking for warehousing space in January 2022, leading to speculation that it might enter the local e-commerce market.
In June 2022, Business Intern said it had obtained documents detailing Amazon’s plans to expand its market to five new countries in Africa, South America and Europe.
Adding even more credence to the potential launch, Amazon recently posted job openings for two senior positions on its “ZA Marketplace.”
E-commerce experts have already told MyBroadband that Amazon could disrupt the local e-commerce space by giving small businesses an alternative platform to sell their products.
Many Takealot sellers take a negative view of the buyer-first approach, which has made its processes for sellers costly and inflexible.
However, Takealot has an extensive local logistics network and has built a strong reputation as the go-to online retailer for many South Africans.
Kim Reid, former CEO of Takealot previously said the retailer was shipping an average of 35,000 orders per day in November 2019.
But that’s still orders of magnitude below Amazon’s numbers.
In 2019, it shipped 1.9 billion packages worldwide, or about 5.2 million shipments per day.
Amazon is also not short of funding to quickly embark on expanding its logistics capabilities and marketing campaigns.
The company also offers a solid value proposition to customers with its Prime membership, which bundles various streaming services, delivery benefits, and exclusive offers for a monthly or annual fee.
The service had over 200 million subscribers worldwide as of April 2021.