After 15 years of burning cash to build South Africa’s e-commerce infrastructure, Takealot is finally approaching profitability—just as three international giants arrive to challenge its dominance. The timing couldn’t be more dramatic.
Takealot expects to post its first-ever full-year profit in the 2026 financial year, a milestone CEO Frederik Zietsman describes as critical for competing against deep-pocketed rivals. But the battlefield has shifted dramatically.
Amazon launched in May 2024, while Chinese platforms Temu and Shein have skyrocketed in popularity, each wielding distinct competitive advantages that threaten Takealot’s hard-won market leadership.
The Home Advantage
Despite the onslaught, Takealot remains the most searched e-commerce platform in South Africa according to Google Trends, even during the Black Friday peak shopping period.
The local champion holds between 15-20% market share, with its nearest competitor being another South African player—Checkers Sixty60 grocery delivery platform.
Takealot’s defensive moat runs deeper than brand recognition. Over the past eight years, the company has built a logistics network that international competitors simply cannot replicate overnight.
The company is now even considering drone deliveries as it flexes its logistics power, though Zietsman notes that door-to-door drone delivery at scale remains largely a gimmick for now.
The real weapon is infrastructure: over 100 pickup points nationwide, same-day delivery in major metros, and a recently opened distribution center in Durban.
Takealot has also recruited thousands of personal shoppers to penetrate townships and rural areas where e-commerce has struggled to gain traction. This ground-level presence gives Takealot intimate knowledge of South African consumer behavior—knowledge that can’t be bought or shipped from overseas.
The platform now supports over 11,000 marketplace sellers, creating a virtuous cycle where small businesses depend on Takealot for market access while simultaneously enriching its product catalog.
Three Different Threats
Each global competitor poses a unique challenge. Amazon brings unmatched scale, technology sophistication, and the credibility of a household name.
Yet Amazon only briefly unseated Takealot in search interest during its May 2024 launch, suggesting the South African market may be less impressed by international prestige than by local reliability.
Shein and Temu present a more insidious threat: ultra-low prices enabled by direct-from-China logistics and, according to Takealot, exploitation of regulatory loopholes.
International platforms have been accused of exploiting outdated regulations and loopholes to lower costs and charge unrealistically low prices. The fashion segment bore the brunt of this assault, contributing to Takealot’s decision to sell off its struggling Superbalist fashion platform in 2024.
Fighting Back: The Regulatory Shield
Unable to compete purely on price against platforms allegedly circumventing import duties, Takealot has pushed for regulatory intervention to ensure an even playing field between local and global players.
The company found an ally in the South African Revenue Service, which closed tax loopholes in late 2024, significantly slowing international pure-play online retailers.
Previously, retailers could avoid higher taxes by splitting orders into smaller shipments. From July 2024, SARS subjected all clothing imports to 45% import duty and 15% VAT, regardless of parcel size.
The Foschini Group CEO noted this change materially impacted Shein and Temu’s explosive growth.
But Zietsman remains cautious. “The proof will be in the pudding” regarding whether new measures truly level the playing field, he told media. His concern extends beyond competition to consumer protection—less-regulated platforms may sell dangerous products that slip through South Africa’s health and safety requirements.
The Profitability Gambit
Takealot’s path to profitability hinges on a delicate calculation. The company posted a R68 million EBIT loss in the first half of FY2026, but expects Black Friday and Christmas sales to push it into the black.
Meanwhile, its food delivery arm Mr D has already achieved profitability, growing 12% and benefiting from the global quick-commerce trend.
The next 60 days are critical, with CFO Tessa Ackermann expressing confidence that holiday sales will secure the first-ever full-year profit.
This milestone isn’t just symbolic—it provides financial resilience to weather a protracted competitive war. Amazon famously took nine years to reach profitability; Takealot’s 15-year journey reflects the unique challenges of building e-commerce infrastructure in an emerging market.
The Long Game
The e-commerce battle in South Africa is ultimately about who can sustainably serve a market where the average consumer spends roughly R2,000 online over six months.
Takealot’s bet is that local knowledge, trusted logistics, regulatory compliance, and customer service trump rock-bottom prices from overseas platforms operating on thin margins.
As South Africa’s e-commerce sector matures toward representing 10% of total retail sales, the question isn’t whether international players will capture market share—they already have.
The question is whether Takealot’s home-field advantages and first-mover infrastructure can defend its leadership position long enough to reach sustainable profitability while global competitors burn through capital trying to dislodge an entrenched local champion.
In this David versus Goliath story, David has spent 15 years building slingshots. Now it’s time to see if they’re accurate enough to matter.
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