Kalahari, Takealot merger is a go

with the retailers attributing the move to an inability to compete with brick and mortar companies
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I know they might have their reasons with the delivery network available, but in what other country do the online retailers complain about difficulty competing with existing physical stores.
 
There goes the competition, consumer screwed once again
 
I know someone that works at Kalahari.
She was telling me that there is fears of jobs losses.
 
Yet another monopoly happening in SA.

Say goodbye to competitive prices and good deals. There is no competition anymore!
 
Although I feel for people who will lose their jobs, it really isn't up to regulators to tell private companies who they can or can't fire.
 
deweyzeph said:
Although I feel for people who will lose their jobs, it really isn't up to regulators to tell private companies who they can or can't fire.
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That was part of the merger agreement between the companies. The competition commission just highlighted it. They also have a duty to make sure the country does not lose unnecessary jobs because of the merger. They did the same thing with massmart.
 
furpile said:
That was part of the merger agreement between the companies. The competition commission just highlighted it. They also have a duty to make sure the country does not lose unnecessary jobs because of the merger. They did the same thing with massmart.
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Private companies should be free to hire or fire whoever they want. Their only duty is to their shareholders. They're not running a charity. A job is a privilege, not a right. This interference is exactly why our economy is in such a mess.
 
Time for another, even more retarded name? Takeahari?
 
deweyzeph said:
Private companies should be free to hire or fire whoever they want. Their only duty is to their shareholders. They're not running a charity. A job is a privilege, not a right. This interference is exactly why our economy is in such a mess.
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I agree, but unfortunately the law in SA says otherwise. It is indeed causing a lot of problems in our economy, instead of protecting jobs it is causing people to remain jobless, as companies don't just want to hire people. I just stated that the 200 people max was part of the merger agreement, meaning Takealot an Kalahari decided on it before going to the commission. The CC just approved their agreement.
 
deweyzeph said:
Private companies should be free to hire or fire whoever they want. Their only duty is to their shareholders. They're not running a charity. A job is a privilege, not a right. This interference is exactly why our economy is in such a mess.
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It also leads to abuse.

"You will work this weekend without overtime pay or I fire you before the end of today."

"You will be on standby for the next 6 months, 24x7."

All this is good for the shareholders too.
 
Still lots of competition as said: Amazon , Ebay , Alibaba , other online retailers.
 
Kosmik said:
Still lots of competition as said: Amazon , Ebay , Alibaba , other online retailers.
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None of which are realistic options in SA unless you are buying very expensive and relatively light items.
 
There will be lots of job losses. Think about the fact that Kalahari runs Hybris on top of SAP for their website and then there is the whole Adobe DRM for digital purchases. Unless Takealot shuts down all Kalahari tech this will become a massive financial (and technical maintenance) burden. Any tech consolidation would be a strategy fail and migrating Kalahari tech into Takealot would take years (the Hybris implementation took apparently 2 years).

Kalahari would still need to honour warranties and returns as per CPA, so it is not as easy as just shutting down the site. The merger opens many operational problems and to be honest I think Naspers was clever to get this deal going as I don't think there is a real value-proposition for Takealot (other than perhaps the book- and digital inventory - both build on technologies which are not really compatible and easy to consolidate). The customer base will not dramatically increase as most customers shop at both sites anyhow and consumers are generally not very brand loyal and follow the company with the cheapest price and most bearable delivery.

Also remember that not a single international competitor (Amazon, Alibaba or Ebay) has entered locally and once this happens it will become really exciting. I think all those stories about "brick and mortar shops will die" are sensationalist - in most cases a consumer will still want to touch/feel/look at a physical product before buying it. Brick-and-mortar stores can follow the click&collect model (what Makro is currently building out) - but even international studies have shown that click&collect does not improve efficiencies (i.e. the study across Macy's, Walmart and others has shown that it is only 90 seconds faster for click&collect vs you physically buying/paying for the product in store).

Also remember that both Kalahari and Takealot use the same distributors and over the years aggressively sold at cost and some times below cost - this already caused issues with some brands as they felt that it devalued the product value. For me a more logical option would have been to bypass local distributors and bulk-import (Walmart style) directly from the manufacturer. Right now everyone sells the same products with more or less the same margins. Returns are still bottlenecked through your local distributors and fulfilment is really only efficient in metro-areas.

Last thing to remember: UPS and Fedex (and in due course then all the other couriers) are introducing dimensional weight pricing which means that international courier fees will go up. This will affect about 30-40% of courier parcels and will obviously see courier costs go up - so Amazon/eBay/Alibaba (in addition to the current USD exchange rates) will become even more expensive.
 
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