SA online shopping problems?

[Swa]

I too, disagree with this statement. Naturally this discussion caught our attention, as e-commerce is our thing - we have been running since 2002 - profitable since 2004 and are still going strong. We actually had a discussion in the office today and once Kalahari mergers, we think we're most likely one of the oldest online stores still in business...

I actually agree with him but not for the reasons mentioned. Online shopping works for the customers but not the shops. A number of players have sabotaged the market for themselves and others. You are on the dot with takealot. I shop around and only buy the loss leaders. Takealot had a camera bag for R249. They raised the price to over 500 obviously needed to make it sustainable for the new stock. I rushed to BoB right then and bought it at the old price. Besides for that the free shipping for such low margins is also not sustainable.

I will be watching things closely for the next 5 years. Either these larger players aren't going to survive or they will be back to the old strategy.

 

[MagicDude4Eva]

One more problem. In order to compete on the level that they want they have to physically stock all products. Defeats the purpose.

I am sure some of the smaller online shops will appreciate how much it costs to warehouse product. Some of the large distributors (who would have a fraction of the warehousing capacity Takealot intends to build) have stock in excess of 300m sitting in their warehouses. So there is a large amount of working capital sitting in stock and that should worry any business (if you can not move it quick enough). For example Apple is one of the few companies in the world, where their stock-holding is merely a few weeks before products sell through - this will not be achievable locally.

 

[HideInLight]

I just wish things were more in line with American pricing and that you could still make a profit of it.
Atm even if something is R15 to the dollar when you get it here, it seems to be at loss or break even margins.

That's pretty messed up.

 

[diabolus]

You know what I miss, a reliable post office where I can ship counter to counter. I can't always stay at home and wait for a parcel to be received, sometimes I would prefer to just go fetch it.

I live is a small forgotten town though, so shipping things in is the only way I can get them without driving 100km.

What we could also do with is Virtual prepaid credit cards, like Walmart sells overseas in their physical shops.
A card with a number is much easier to use than a smartphone app, multiple linked accounts etc.

In fact, that's what takealot needs to start doing, selling vouchers in brick and mortar stores.

Yea, coming to think of it , THIS is exactly what holds me back the most when ordering online (specifically impulse & regular buying) . I always have to figure out "where and when is this going to be delivered" and then what address to use. To make matter worse, if i deliver it at work, i have to go through a ton of red tape to get it out of the building again (security).

I also long for the days where i could have it delivered at a post office and pick it up there at my own leisure, now i need to constantly ensure a person (that knows me) is at given delivery address to pick it up...very very annoying.

At times it's so bad that i don't want to order something purely because i ordered something too recently. So having a package delivered every 2nd week , at work, is also attracting a ton of unnecessary attention from co-workers , despite the content being "grocery" value . So where i would've ordered alot of "consumables" online (i.e. my coffee/tea/wine/etc) to be delivery bi-weekly , i now rather go to a physical shop since it is just such a hassle to arrange courier delivery everytime.

 

[Gnome]

There is no confusion about AWS/call-centres and the retail business. It is just a very logical next step for international retailers to enter the african market via South Africa. I did say within the next 5 years and I am quite confident about this statement. People had a similar sentiment a decade ago about local POPs of various providers and looking at it now we have Akamai, Cloudflare, AWS, Dyn (and a number of others currently provisioning in SA).

Fair enough, I may have jumped the gun with my statement of assumptions. I still don't see it happening tho

A full scale operation like Amazon Retail however is super expensive. You'll notice Amazon isn't posting much of a profit. Mostly because they are pouring money into building fulfilment centres. They are really, really expensive.

To justify that cost, there needs to be a clear picture of growth. And for an international company there is more to it than just that. They have many places in the world they can expand into.

Finally take Takealot as a competitor.

1) They have a strong customer oriented focus (Just like Amazon)
2) They have a strong marketing focus (eg. Savealot)
3) They bought their own delivery service. The strategic value of that purchase cannot be understated. This is something Amazon is trying to do currently to improve customer experience. Amazon prime is a big seller exactly because it has free 2 day shipping. People LOVE fast shipping. Not just that, they communicate really well when they'll deliver and keep you constantly informed.
4) They have a very strong focus on price. Takealot has good prices!
All of the above speaks to the same principle that makes Amazon so successful. They place the customer first. If you want to be successful in online shopping the entire DNA of your company needs to be around making every customer happy. Happy online shoppers are like crack addicts.

Given that Takealot has some former Amazon employees I wouldn't be surprised if their core values are inspired by it and it will be very hard to compete with them.

Kalahari actually looks pretty pathetic in comparison to Takealot IMO. They had horrible delivery times, they had high prices, their selection sucks. The company clearly lacked the right kind of people and direction that you need to run a company like that successfully.

Anyway, just my opinion, and no I don't work for any of the companies above

 

[Swa]

Kalahari actually looks pretty pathetic in comparison to Takealot IMO. They had horrible delivery times, they had high prices, their selection sucks. The company clearly lacked the right kind of people and direction that you need to run a company like that successfully.

So if they were so bad what positives will they contribute to Takealot?

 

[Hitchcock]

So if they were so bad what positives will they contribute to Takealot?

Well, at the end of the day I do not think that either company contributes anything positive to the other.

The purpose of the merger was merely to kill the competition. Both companies admitted that competition between them was so fierce that neither could operate on a profitable basis and therefore decided to merge.

The real shock will come soon when the new company will find that business will NOT be skyrocketing after the merger.

 

[SauRoNZA]

The biggest question I have is why people even have worries with importing when it's easier than ever.

Online is absolutely border less at this point with companies like eBay and Amazon making it so simple by including import and shipping duties at check out.

I bought an R8000 item off eBay recently which was at my door 3 days later over the festive season.

That's only a day longer than Kalahari usually take.

It's an item I couldn't get online locally and the brick and mortar wanted 13k for it and would take two weeks from date of order.

 

[Hitchcock]

The biggest question I have is why people even have worries with importing when it's easier than ever.

Online is absolutely border less at this point with companies like eBay and Amazon making it so simple by including import and shipping duties at check out.

I bought an R8000 item off eBay recently which was at my door 3 days later over the festive season.

That's only a day longer than Kalahari usually take.

It's an item I couldn't get online locally and the brick and mortar wanted 13k for it and would take two weeks from date of order.

Agreed! 100%

The past 7 years I only purchased online twice in SA, once from Takealot and once from Kalahari. Most of my purchases online are through eBay, and before they started blocking SA out, most purchases I made was via Amazon.

Normally my deliveries take 4-6 business days and goods are delivered to my door by Fedex. Ebay takes care of all import charges, courier fees - everything at the time of ordering.

Much easier, simpler and most of the times cheaper than buying in SA.

 

[SauRoNZA]

Don't get me wrong, I buy a lot of stuff locally and mostly online.

Price is always king though and importing won't stop me getting what I want.

 

[Hitchcock]

Don't get me wrong, I buy a lot of stuff locally and mostly online.

Price is always king though and importing won't stop me getting what I want.

Don't get me wrong either, I also buy a lot of stuff locally, especially in brick and mortar stores. If I need some tech product urgently, instead of waiting a week, I will simply jump in my car, drive 10KMs to Cresta and get it there.

If I am looking at burning some extra cash laying around, I do it online on eBay. Like I said, I order and pay for everything - delivery, import taxes - at checkout. Hell, I even get insurance from eBay at no extra costs. The product is often delivered the same week I ordered it. Often I pay cheaper for goods abroad. What online SA retailer can offer me this?

 

[SauRoNZA]

Yup. I would say short of household monthly purchases I buy nothing short of clothing in store.

 

[Hitchcock]

Yup. I would say short of household monthly purchases I buy nothing short of clothing in store.

Yep, household and clothing locally. Importing clothing is ridiculous here in SA, government made sure that it is cheaper buying clothes locally.

 

[Jared176]

Agreed! 100%

The past 7 years I only purchased online twice in SA, once from Takealot and once from Kalahari. Most of my purchases online are through eBay, and before they started blocking SA out, most purchases I made was via Amazon.

Normally my deliveries take 4-6 business days and goods are delivered to my door by Fedex. Ebay takes care of all import charges, courier fees - everything at the time of ordering.

Much easier, simpler and most of the times cheaper than buying in SA.

Thread revival...

Amazon.com started shipping PS4's here and now it says they don't. Any idea why this is?

 

[MagicDude4Eva]

Thread revival...

Amazon.com started shipping PS4's here and now it says they don't. Any idea why this is?

Thanks to SABS Amazon doesn't ship electronic goods which have its own power source.

 

[Jared176]

Thanks to SABS Amazon doesn't ship electronic goods which have its own power source.

I tried with Amazon UK and they are willing to ship a PS4 to SA.

 

[Space_Chief]

The biggest question I have is why people even have worries with importing when it's easier than ever.

Online is absolutely border less at this point with companies like eBay and Amazon making it so simple by including import and shipping duties at check out.

I bought an R8000 item off eBay recently which was at my door 3 days later over the festive season.

That's only a day longer than Kalahari usually take.

It's an item I couldn't get online locally and the brick and mortar wanted 13k for it and would take two weeks from date of order.

That's nothing. Been buying online since 1999 or 98. Most of the time items were sent by regular mail and arrived OK and even quite fast.
As said many times before Tokyo or Kyoto to Cape Town, 3 days by EMS, or under 2 weeks from USA by airmail. Some shippers were very cheap with FedEx, remember the Canadian outfit DVD-Depot? Anyone remember Airborne Express?

 

[Space_Chief]

Thanks to SABS Amazon doesn't ship electronic goods which have its own power source.

Amazon always had a policy of no electronics, no software etc to SA. Only books, CDs and DVDs, even though these are also classified as software when it comes to "rights".

It's also pretty stupid of them to worry about a second tier outfit like SABS while US', Japanese and European certification agencies which have higher standards are OK with these items. The powebricks are after all the same, it's only the plug which is different. And tons of two pronged devices are available for sale locally too.