Business & Finance

Temu vs. Takealot: A Price Comparison on Small Electronics and Accessories

Temu significantly undercuts Takealot in pricing for small electronics and accessories, offering South African consumers a more affordable option for these items, despite additional import taxes.

In a recent price comparison conducted by MyBroadband, Temu, a direct-from-China marketplace, has emerged as a formidable competitor to South Africa’s popular online retailer, Takealot. The comparison focused on small electronics and accessories sold by resellers on Takealot and revealed substantial price differences, favoring Temu.

Temu’s Market Advantage: Temu has revolutionized the e-commerce landscape with its direct sourcing from manufacturers and merchandise partners in China. This model allows Temu to bypass middlemen, significantly reducing costs and offering products at lower prices compared to Takealot resellers, who typically source their stock from overseas or local suppliers.

While other Chinese e-commerce platforms like Aliexpress have been present for a longer period, Temu’s strategic advantage lies in its logistics. Utilizing Buffalo Logistics, Temu has established a reliable and efficient fulfillment system in South Africa, ensuring timely deliveries and customer satisfaction.

Price Comparison Analysis: To illustrate the price differences, identical small electronics and accessories were compared between Takealot and Temu. It’s important to note that Temu’s listed prices do not include import duties or VAT, while Takealot’s prices are inclusive of all costs except for delivery. Temu customers must pay the applicable taxes when their products arrive at South African customs.

For most small electronics and accessories priced under R500, the tax implications are relatively minor. Generally, these items are subject to an added tax value (ATV) of 110% of the item’s price, plus 15% VAT on the uplifted price. For instance, a product costing R100 would have an ATV of R110 and a VAT of R16.50, bringing the total to R126.50.

However, certain electronics like TVs and computer monitors may incur additional ad valorem taxes, making them potentially more expensive to import than purchasing locally.

Despite these additional costs, Temu often provides better deals. A notable example from the comparison was a small USB night light, priced at R84 on Takealot, versus a 10-pack for R26 on Temu. After applying taxes, the effective cost per night light from Temu was R3.20, which is 2,525% cheaper than the Takealot price.

Range and Brand Considerations: It’s worth noting that Temu’s catalog primarily features small, low-value items. High-end products from reputable brands, such as iPhones or official Apple accessories, are generally not available on Temu. These products are typically distributed by major wholesalers with additional operating, storage, and after-sales costs, contributing to their higher prices.

Moreover, while Temu offers significant cost savings, Takealot’s local presence might make it easier for customers to return items and receive refunds, given Temu’s lack of local offices and support.

Conclusion: Temu’s competitive pricing on small electronics and accessories presents a compelling option for South African consumers looking to save money. Despite the additional import duties and VAT, many items still come out cheaper than purchasing through Takealot. However, for high-end electronics and brand-name products, consumers might still prefer the convenience and reliability of local purchases through Takealot.

Price Comparison Table:

ItemTakealot Price (ZAR)Temu Price (ZAR)Total Cost on Temu after Tax (ZAR)
USB Night Light842.60 (per unit)3.20 (per unit)
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