News24 interview: Competition Commission rulings for Takealot and Google

Aug 01, 2023

Following the release of the Competition Commission's rulings for Takealot, Google and other online players, News24 reached out to Insaka's founder Warrick Kernes for an interview on the outcomes of the rulings. 

News24 has given us permission to share the audio of the interview recording but here's the key takeaways from the interview: 

Key takeaways

  1. The news was shared in our community of 36,000 online sellers and many marketplace sellers are applauding the rulings and changes while others are doubtful that all of these changes will come to fruition.

  2. With Warrick Kernes having sold millions of Rands of products on Takealothe's had personal experience with how they have previously used seller data to flag hot new products for them to sell, change the buy box outside of their rules and the many other challenges that have impacted other marketplace sellers.

  3. Education for new sellers has been emphasized and we cant support this enough. Insaka's belief is that the difference between someone who tries and fails and the person who gets their first sales and continues to success.... Is education. 

  4. Have your own website!!! Don't play in someone else's sandbox as you're at risk of their changes negatively impacting your business. So have your own website where you can have higher profit margins and collect customer data and then leverage every suitable marketplace by sync'ing your products across to those platforms. 

Six Benefits to SMEs from the Competition Commission's rulings:

  1. SME's are freely able to have a lower prices on their own websites

  2. SME's are free to sell products on TAL which TAL themselves are selling

  3. Data from SME's sales on marketplaces won't be used by the marketplace

  4. 60 days dispute resolutions on questionable returns or lost goods. 

  5. Support for historically disadvantaged persons

  6. Forced budget for training and upskilling sellers and advertisers. This is great! 


Three potential downsides to SMEs from the Competition Commission's rulings:

  1. Segregating marketplace sales and retail sales may lead to less traffic (and sales) for marketplace sellers as it will likely be more logical for the marketplace owner to drive their traffic towards their own products where they are making higher profit margins. 

  2. The report states that "the Buy Box must be re-engineered to reflect the cheapest (regardless of delivery time) and fastest options for the consumer". This will likely reduce sales as we know that having quicker delivery combined with a good price leads to higher sales. 

  3. These changes may dissuade Amazon from launching their South African retail and marketplace divisions.


Recommendation from Warrick Kernes: 

Most of the rulings are in favour of helping SMEs and this is fantastic but segregating the marketplace products from retail products will likely lead to a poor user experience and negatively impact sales overall. 

If this segregation is enforced then it may compromise Amazon's decision to launch into South Africa and this in itself would have an adverse affect than what the Competition Commission has set out to achieve because if this were to happen then the biggest winner would indeed be Takealot. 


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Read more about the report here with the Summary of Findings document released by the Competition Commission