Takealot has been able to continue paying its staff their full salaries, despite losing over 80% of its revenue when South Africa went into lockdown on 27 March 2020.
“We’ve chosen not to reduce salaries at this stage,” Takealot CEO Kim Reid told MyBroadband.
Reid explained that Takealot’s cost base has not reduced during the national lockdown, but they believe they have an obligation towards their staff.
However, Takealot also cannot guarantee that it will be able to continue paying the full salaries of its employees if ecommerce continues to be restricted in the same way as physical retail stores.
“The impact of this lockdown on us has been severe, though we have tried to put mitigating plans in place” Reid stated.
While Takealot adapted quickly to sell essential goods like healthcare products, sanitisers, and baby products, the lockdown still caused a big drop in sales.
During the full lockdown, before retailers were allowed to sell electronics such as laptops and cellphones, Reid said they only saw around 15% of their usual sales volumes.
He said at the time they expected the lockdown to cost Takealot around R350 million.
Allow online shops to sell anything – Takealot CEO
Reid has joined other logistics and ecommerce players in calling for the government to allow online shops to sell and deliver any item in their warehouses.
“Social distancing is built into ecommerce,” Reid said, adding that with a few simple delivery protocols, ecommerce allows for a very hygienic way of shopping.
“If we look at Wuhan, China, in the midst of the outbreak ecommerce companies were encouraged to continue operating,” said Reid.
Since there is no need to discourage people from lingering in physical stores for too long, online shops can and should be allowed to sell their whole inventory.
Reid pointed out that since the start of the lockdown in South Africa, people have been reporting the urgent need to buy certain items which have been deemed non-essential.
“For a widow in a small apartment who uses her microwave to cook meals, it is a big problem if her microwave blows. To her, that microwave is essential,” Reid said.