Online rivals Kalahari and Takealot join forces

KALAHARI.COM said yesterday it would merge with competitor takealot.com.

The move is driven by the fact that‚ without scale‚ South African online retailers simply can not compete successfully against domestic brick and mortar retailers and foreign companies like Amazon and Alibaba.

Senior executive Oliver Rippel, responsible for Kalahari, said: "After many years of losses on Kalahari and four years on Takealot‚ we realise we have to work together if we are to survive and prosper.

"If you also take into account an uneven playing field against foreign operators who do not pay tax in South Africa‚ and that high broadband costs are impeding the speed of growth in [domestic] online shoppers‚ combining forces gives us a better chance of success‚" he said.

Online retail only accounts for about 1.3% of the total market for consumer goods in South Africa.

The channel has great upside potential when one considers that in developed markets like the US and Britain, online retail accounts for as much as 14% of total consumer goods retail.

The merged entity under the Takealot brand will be managed by Takealot chief executive Kim Reid with co-chief executive and chief technology officer Willem van Biljon.

The merger is subject to Competition Commission approval. – BDlive