Takealot takes R350-million hit because of lockdown

Takealot CEO Kim Reid expects the national lockdown in South Africa to cost the company around R350 million, due to the restrictions on ecommerce.

Online retailers are prohibited from selling or delivering any non-essential goods during the lockdown.

Takealot, which also owns clothing store Superbalist and food delivery service Mr D Food, was hit hard by these restrictions.

Reid told Reuters their sales have plummeted since the lockdown began, which is leaving the company in distress.

Takealot quickly adapted to allow its customers to buy essential goods like healthcare products, sanitisers, and baby products.

This was not enough to prevent a big sales drop, however, and Reid said they are currently only seeing around 15% of their usual sales volumes.

Takealot also had to cancel many orders for non-essential goods which were placed before the lockdown, which could not be fulfilled due to the restrictions.

Call on the government to relax ecommerce restrictions

Reid hopes that the government will relax its restrictions on ecommerce and deliveries soon.

During the lockdowns in China, the US, and the UK, ecommerce players were allowed to operate without restrictions.

Reid argues that ecommerce helps with social distancing as it allows for the contactless delivery of products.

His views are echoed by other ecommerce companies which are lobbying Trade and Industry Minister Ebrahim Patel to allow online shopping and deliveries to continue.

They argue the ecommerce sector provides a valuable service to society while not adding undue risk to the further spread of COVID-19.

“We hereby request that you seriously consider allowing approved courier companies adhering to stringent preventative measures to transport all goods domestically,” a letter to Patel stated.

“We can play a vital part in not only preventing the spread of the virus, but ensuring the well-being of South Africans – please allow us to do this.”

Now read: The cure should not be worse than the virus – SA businesses

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Takealot takes R350-million hit because of lockdown