Shoprite continues to grow
Shoprite managed to increase its trading profit by a massive 17% this year. Last year they laid out their expansion plan - 74 new stores in one year (link). It seems to have paid off. Pick and Pay continue to struggle (link).
A few interesting things to come out from Whitey Basson’s statement in the Times (Full Article here):
Shoprite’s success seems to hinge on three broad trends:
- Increased social security spending by the government - the recipients spend a large proportion of it on food;
- Strong expansion into the rest of Africa, which is not as susceptible to economic downturn as elsewhere; and
- Taking market share from rivals, specifically their customers in the higher-income groups.
The group’s African expansion continued, with 21 stores opened last year. It now has 156 stores in 16 countries outside South Africa and increased its turnover outside the country by more than 25%.
“Of our top 10 stores, three are now outside South Africa,” said Basson.
University of Cape Town