Takealot CEO Mamongae Mahlare says the ecommerce company is trying to ensure a good crisis doesn’t go to waste

19 Mar 2023

Ecommerce is in its infancy in South Africa. SA's leading online retailer is helping to grow the trade in South Africa by nurturing entrepreneurs to thrive and become strong businesses while resolving customers’ ‘pain points’, Mahlare explains in a wide ranging interview.

The biggest bellyache with online deliveries – that’s if using a reputable seller – is not that the clothes will be ill-fitting or poor quality; that the shoes will be the wrong size or that the grocery item you picked was substituted with an incorrect brand: it’s that you had to sit at home for hours, unable to run other errands, while waiting for the goods to arrive. And then to discover the order’s been messed up.

Leading online retailer Takealot says it is acutely aware of customers’ “pain points”, which is why it is testing new collection options while developing technology to improve the customer experience.

It is also hoping to invigorate the economy by driving a programme to enable more SMMEs to access markets while growing their national footprint.

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Takealot’s group chief executive officer, Mamongae Mahlare, says one of the key realities of the platform is that it is a marketplace and an empowerment enabler for SMEs’ access to markets.

“We’ve gone from 124 sellers in 2014 to around 8,000 sellers now. This platform is powerful as an enabler for SMEs to be able to establish their businesses, but more importantly to also grow. And we’ve continued to improve on the operational support service on our platform.”

Support for SMEs ranges from how to manage accounts and how to make money, to important factors for a business to consider, and how to get stock out in time. But what has become more apparent is the need for more support to become a successful business – skills that all entrepreneurs need to run a viable business.

In mid-February, Takealot launched a programme to assist black entrepreneurs. This past weekend, it completed its first-phase boot camp in Cape Town; next weekend another takes place in Johannesburg.

The first phase is essentially an accelerator programme which offers workshops and interactive learning opportunities. During the second phase, the 30 participants in the programme will submit their business cases. They will be mentored and a few may require capital to accelerate their business. Takealot will be offering limited grants to some worthy entrepreneurs, although Mamongae would not be drawn into revealing the quantum.

The final phase will be practical, giving budding entrepreneurs important exposure in the real world and gaining life skills such as keeping records, basic accounting and registering their business/brand.

Mamongae says this will strengthen their ability to thrive.

“We need to have an economy that grows and is inclusive. Enabling especially black SMEs is crucial. We need to ensure that these SMEs are able to be sustainable. Every sale is important.”

Power outage solutions

Operating in South Africa under punishing power outages is always a challenge as generators, diesel and other mitigating solutions are costly – but Takelot has profited immensely from the crisis, as customers’ demand for “load shedding solutions” has never been higher. The website has a dedicated section to help customers stay connected in the dark; keep appliances running and generate power.

“We’ve sold tons of load shedding equipment, which is helping our customers have more continuity in their day. When you have about 10 hours of outages, you need to be able to charge batteries, laptops, UPSs and other equipment. It’s a very important part of our business, which is why we’ve also invested a lot in terms of our service offering and our website.”

The website also offers advice in terms of what customers might need for their particular requirements to ensure that they get on with their lives at home or at work, from economical items such as LED lights to high-end, pricey solutions.

Deliveries

On those pesky deliveries: Takelot is enhancing its tech to improve and shorten the window, but that will take some time as it’s a complex matter, Mamongae explains.

For now, the number of pick-up points has grown to about 90 across the country. It is also testing collection points at two Pick n Pays – Table Bay and Brackenfell. This helps customers can pick up their parcels when convenient, instead of waiting for deliveries.

Ecommerce is still in a developmental phase with enormous potential for growth in South Africa, which is why new players like Amazon – said to be gearing up for launch in SA by the end of 2023 – could help stimulate the space.

“We are hopeful that [Amazon] will be a constructive player looking to grow the pie so that we can all build a sustainable model of ecommerce in this country. Because as it stands today, ecommerce comprises only about 4% of retail, which is over R1.2-trillion. When you compare it to other emerging markets, like Brazil, [ecommerce] penetration is sitting at between 12% and 20%,” said Mamongae.

“There is vast opportunity for growth for ecommerce and we remain cautiously optimistic that investment will contribute to growing penetration of ecommerce so that you can grow the sector. Because that’s the only way it will make business sense, by growing, as it’s not currently very big.” BM/DM

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