Takealot Group has blasted the Competition Commission, expressing “disappointment” about the regulator’s findings in its final report on online intermediation platforms in South Africa, which it published on Monday.
Among the remediation actions the commission proposes to impose on the group is splitting Takealot.com’s marketplace platform from its own retail division and several provisions relating to advertising, contracting and pricing for the group’s Mr D Food business.
“While we are supportive of the Competition Commission’s work around the market inquiry to protect small and medium businesses and consumers, we are disappointed with some of the findings in the final report that are incorrectly premised on the notion that Takealot and Mr D are ‘leading platforms’, when they compete in dynamic markets with much larger competitors in which consumers have considerable choice,” said a spokeswoman for the online retailer in response to a query from TechCentral.
Group CEO Mamongae Mahlare previously hinted at the idea that the commission’s definition of Takealot.com may be myopic, distorting the commission’s understanding of the online retailer’s significance in South Africa’s retail sector.
“An important point of departure is considering market definitions in this space. I am a retailer, I am competing against established and emerging businesses in the same way … and we are so nascent,” Mahlare told the TechCentral Show in an interview last month.
The commission’s view, however, places Takealot.com in the same league as the multinational online retail giant Amazon.com, effectively saying in the inquiry report that the “same rules” apply to any “large e-commerce player”. The company has questioned the fairness of this classification.
“Takealot.com competes with other, much larger, brick-and-mortar retailers that have a sizeable and growing presence online but are excluded from complying with these requirements,” the spokeswoman said. “It also forms a small part — less than 2% — of the overall retail market in South Africa. Equally, the same reality applies to Mr D Food, which is a very small contributor to any restaurant’s revenues.”
The e-commerce group also believes the commission’s findings are punitive and not rewarding of the contributions that the group has made to the South African economy – a point also emphasised by Mahlare on the TechCentral Show. “Takealot Group is a proudly South African business and has a proven track record of enabling over 18 000 SMEs as well as supporting 33 000 jobs,” she said.
“We have achieved this in just 13 years, operating in a highly competitive and dynamic environment. If allowed to continue to thrive and fairly compete, the opportunities for job creation and SME enablement would be exponential”, the spokeswoman added. – © 2023 NewsCentral Media