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South Africa-based Woolworths has reported a slower growth in sales for the 26 weeks ending 23 December 2018. Sales increased by 1.9% compared with a 2.5% increase in the same period in 2017.

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Pick n Pay has worked with three Gauteng-based entrepreneurs to open spaza stores through its modernisation programme. The programme allows entrepreneurs to remain independent, while helping them incorporate new systems and upskill them regarding their retailing expertise.

The spaza modernisation programme

Since its launch in Gauteng in 2016, Pick n Pay’s programme has helped open 20 stores. Pick n Pay provides mentorship and training to help store owners and their staff enhance their skills.

Pick n Pay’s deputy CEO, Richard van Rensburg, said, “We believe successful businesses help the broader community and with this programme we have the opportunity to work alongside township retailers to either help build or grow their business”.

The stores…

BVN Market, Mohlakeng: BVN Market, owned by Vusi Ndhlovu, was opened 20 December 2018 in Mohlakeng. The programme helped the store to double in size to 129 sq m (including a bottle store of 63 sq m). It has also helped increase Ndhlovu’s staff from six to 16.

Dinny's Market, Sebokeng: Entrepreneur, Johannes Letswalo, opened Dinny's Market in Sebokeng in November 2018, creating 23 jobs for first-time workers.

Summore Market, Tembisa: Pick n Pay helped Pilane Kwakwa open Summore Market in Tembisa on 7 December 2018. The 503 sq m store has already created employment for 19 people.

Stores help to serve their communities better

The new spaza stores will offer their communities greater convenience, job opportunities and improved access to affordable goods and services. Pick n Pay equips the stores with new technologies, branded products and refrigeration.

The stores are supplied with 1,300 lines of fresh produce, perishables and non-food products and a bakery, butchery and deli area. Services including bill payments, data, lottery tickets and money transfer are also available.

South Africa-based Woolworths and OK Zimbabwe have released their latest financial statements. Meanwhile, wholesaler and retailer Sefalana has successfully trialled 10 Botswana Post kiosks in stores in its home market.

Woolworths sales increase 2.7%

Woolworths reported an increase in overall sales of 2.7% and by 3.6% in constant currency terms for the first 20 weeks of its 2019 financial year. The group’s food sales rose by 7.2% due to “volume growth driven by low inflation and higher levels of promotion”. Food inflation slowed to 1% from 4.5%, while comparable sales grew by 5%.

OK Zimbabwe revenue rise 23.2%

OK Zimbabwe generated an increase in revenue of 23.2% to US$330.1m for the quarter ending 30 September 2018. Profit after tax rose by 66.3% to US$8.4m, driven by “[increased] volumes, efficiency and inflation”. During H2 2018, the company opened a new store in Harare and refurbished its Marondera store and OK Bon Marche Chisipite store in Harare. OK Zimbabwe will continue to refurbish stores and will open a new store in Masvingo by the end of 2018.

OK Zimbabwe explained that the government’s recent attempts to stabilise the economy through fiscal and monetary policy, created a ‘temporary’ period of price increases and product shortages.

Herbert Nkala, OK Zimbabwe’s chairman, commented, “Despite these challenges, the board and management believe that the current market dynamics are temporary, and the outlook remains positive in the medium to long-term. The group continues to explore opportunities to grow market share profitably in order to enhance shareholder value.”

Sefalana successfully trials BotswanaPost kiosks

Botswana-based Sefalana has successfully trialled 10 BotswanaPost kiosks in stores across the country. BotswanaPost will extend the range of services it offers through its post offices by using mobile technology platforms.

Commenting on the collaboration, Cornelius Ramatlhakwane, BotswanaPost’s CEO, stated, “In the year under review, 10 more kiosks were constructed in Sefalana stores at a marginal cost. This smart and growing partnership has improved service access for Botswana using Sefalana stores in targeted villages”.

SPAR South Africa's CEO, Graham O’Connor, has reported a growth in sales following the company's 2018 full year results. O'Connor said that the retailer's South African operations had benefited from  President Cyril Ramaphosa’s drive to encourage inward investment into the country. At a group level, SPAR South Africa said its turnover grew 5.8%, while operating profit rose 7.9%.

Investment drive starting to pay off

After being elected in February 2018, Ramaphosa prioritised rebuilding South Africa’s economy by encouraging local and foreign business investment. O’Connor supported the drive to create a more business-friendly environment, stating that the “Government is listening to business”.

According to O’Connor, the Government’s efforts is starting to pay off, with sales increasing since the end of the financial year in September 2018. SPAR’s overall turnover and operating profit increased 6% to ZAR103bn (US$7.2bn) and 7.9% to ZAR2.78bn (US$195m) respectively.

Southern Africa: biggest driver of growth

The group’s operations in Southern Africa was reported the biggest driver of growth, increasing turnover by 6.7% to ZAR68.8bn (US$4.8bn). SPAR’s operations in South Africa particularly benefitted from its extensive network of stores. The network is due to expand following the recent agreement with Shell to operate forecourt stores.

The retailer also attributes growth to its liquor, pharmaceuticals and DIY segments and the acquisition of pharmaceuticals wholesaler S Buys in 2017. O’Connor explained that the acquisition allowed its pharmacies to source more affordable products.

Ireland and Switzerland operations

SPAR Ireland’s turnover and operating profit grew 9.6% to ZAR22.49bn (US$1.58bn) and 13% to ZAR574.4m (US$40.3m) respectively. Elsewhere in Switzerland, turnover fell from ZAR10.4bn (US$730m) to ZAR9.8bn (US$687m) due to stores closures. However, operating profit grew from ZAR69m (US$4.8m) to ZAR124.9m (US$8.76m).


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