Shoprite / April 2023 / Enterprise Africa

SHOPRITE GROUP

SHOPRITE GROUP

A Future-Fit Force for Good

For the Shoprite Group, South Africa’s largest retailer by all of market capitalisation, sales, profit, and number of employees and customers, key decisions taken some years ago are now bearing significant fruit. The Group is operationally, structurally, and financially much stronger today, with nine strategic drivers providing a robust framework for growth and assuring the future fitness of the business.

PRODUCTION: Eleanor Sarbutt-King

//Since the opening of its first stores in 1979, Shoprite Holdings has maintained the same bold vision for the future, which has enabled it to become the dominant food retailer today in South Africa and further afield, into nine other African countries. “Over the past 40 years,” Shoprite underlines, “we’ve proved our resilience and value by creating brand trust, recognition and goodwill in the countries where we operate.

“With more than 3,152 stores across Africa and over 152,000 employees, we will strive to seize new opportunities for growth in the years to come.”

Shoprite pinpoints an unmatched ability to leverage an invaluable leadership position in South African food retail, alongside heavy investment into digital transformation initiatives,

as having been pivotal to unlocking additional ecosystem opportunities to date to keep the business fully future-fit. “We believe that by remaining focused on optimising our business in its core South African market and investing in ecosystem adjacencies that are of value to our customers,” Shoprite then furthers, “we will unlock significant opportunities to grow our business and carve out complementary revenue opportunities in the future.”

PIVOTAL PILLARS

Underpinned by nine strategic drivers that furnish Shoprite with its framework for growth, while ensuring the business remains relevant within its existing operating context and from a best-inclass global retail perspective, are three strategic pillars: A Smarter Shoprite,

Closing the gap in key segments and Winning in the long term. The first entails smarter decisions, fewer mistakes and being truly optimised for customers, with future-fit channels

// TECHNOLOGY WILL AMPLIFY OUR ABILITY TO CONTINUE PROVIDING OPERATIONAL EXCELLENCE AND OUTSTANDING CUSTOMER EXPERIENCES //

Black Friday at Petshop Science includes savings of up to 50% both in-store and online

enabling precision retailing.

“We then focus on closing the opportunity gaps in areas where we have headroom for revenue growth,” Shoprite unpacks, “with trusted, profitable private labels, by growing our share in premium and fresh food and building a stronger franchise offering. In the long term, technology will amplify our ability to continue providing operational excellence and outstanding customer experiences.” In doing so, Shoprite aims additionally to unlock alternative revenue, source future-fit talent and leverage a considerable platform advantage.

“Customer-centric decisionmaking is driving our leadership in retail,” Shoprite delineates in more detail. “It keeps us focused on what our customers want in our

core business activities. Customer data powers decision-making at all levels of the organisation and drives continuous improvement. Customer insight is improving our business processes and helping our supplier partners improve our products and services to benefit our customers more rapidly than ever before.”

To close those all-important opportunity gaps, Shoprite will continue to make use of its sheer scale and size to afford access to trusted, profitable private labels. “Our scale allows us to build a meaningful private-label brand portfolio and supply chain,” it clarifies. “We develop and distribute products more efficiently, offering unrivalled choice and affordability, creating win-win partnerships with suppliers.

“We have established leadership

positions in both our value and premium tier private-label brands, while our franchise brands offer entrepreneurs in South Africa and neighbouring countries access to a franchise proposition, which leverages the Group’s buying power and supply chain capabilities.”

To secure continued victories and success over many more years to come, a platform of just short of 25 million engaged customers in South Africa, combined with investment in digital commerce presents huge opportunity to unlock alternative revenue in the digital and services space. “Customer data powers the design of products that customers love and allows us to make better, more affordable options available to customers through new adjacent verticals.

// OUR MULTI-YEAR STRATEGIC TRANSFORMATION JOURNEY HAS DELIVERED 40 MONTHS OF CONSECUTIVE MARKET SHARE GAINS //

“Emerging retail technology trends and rapidly changing consumer expectations require talent that is skilled in new digital technologies,” Shoprite identifies. “Experienced data and technology talent is in high demand and we have made great inroads into new and agile ways of working to ensure we achieve fit-for-the-times outcomes.

“Our retail teams are at the centre of a changing in-store customer environment and are equipped for the demands of new retail.”

TRANSFORMATION JOURNEY

The upshot of this multi-year strategic transformation journey has been

results and performances which, without exception, serve to set the Group apart from the crowd. In the 2022 Deloitte Global Powers of Retailing survey, Shoprite Holdings was listed as the largest retailer in the Africa and Middle East region, while rising seven places to the 100th position in the global rankings. Sales followed suit for the 52 weeks to July 2022, increasing by 9.6% to R184.1 billion producing a gross profit of R45.1 billion.

There has been significant progress against aspects of the Shoprite strategy, too. It has achieved a 75% share of the grocery delivery market since launching from eight stores in November 2019.

1,285 new products were launched in

2022 across the full range of its private labels compared to 717 in the year preceding, while it inaugurated both Petshop Science and Little Me, ended the year with 22 stores and one store at year end respectively, and a further at year end, 19 and 10 planned for 2023.

“Our multi-year strategic transformation journey has delivered 40 months of consecutive market share gains while closing gaps we had identified in key segments,” outlined Pieter Engelbrecht, Shoprite CEO. “The initiatives underpinning our commitment to unlock alternative revenue streams are beginning to reflect positively on our returns and profitability.”

2022 was probably the most challenging year Shoprite has ever faced from an external environment perspective; only customary expert planning, exceptional teamwork and seamless execution on all fronts enabled it to achieve its primary objective

Checkers Sixty60 launches new delivery guarantee – an SA retail first

THE SOUTH AFRICAN BREWERIES SEES VALUES IN PARTNERING WITH ITS KEY ACCOUNTS

In 2022, the South African Breweries(SAB) recently repositioned its corporate brand with a brand-new logo and a purpose that aims to get South Africans to see beer differently by ‘dreaming big to create a future with more cheers’.

Leading the charge towards this new ‘future with more cheers’ is SAB CEO Richard Rivett-Carnac who said, “our big dream is to contribute meaningfully to the growth of the South African economy, creating jobs and building thriving communities”.

Part of this strategy is working closely with its Key Accounts such as Shoprite to ensure that, not only does SAB grows responsibly, but that its key accounts also grow.

In October 2022, SAB hosted a number of Key Account partners at their Head Quarters in Bryanston as part of its efforts to work more collaboratively and to find mutual growth opportunities.

“As markets mature, we naturally see that shoppers move towards key accounts. Shoppers are looking for outstanding shopping experiences- which means great store layouts, nice stores to shop in, stores that have great price as well”, said Rivett-Carnac.

Rivett-Carnac who has been a CEO for more than a year has a dream to not only make SAB grow responsibly, but to ensure that there’s scale and efficiencies that are realized from the growth. “In growing SAB, we grow the country as well as the economy and the role that both SAB and the Key Accounts plays in that cannot be underestimated. “My dream is to ensure that we can supply our customers with the stock that they need, and as such we will continue to work tirelessly to increase production and increase the efficiency of our business, so that we can meet all of our customer and consumer needs”.

SAB’s intention is to ensure that the business grows with its key account partners. Rivett-Carnac concludes :Our vision is to have a triple win- its important for shoppers to win- to have a great shopping experience and to derive value while they shop. We also want our key retailers to win- so that their businesses can grow. It’s ultimately important for SAB to win.

of bringing customers food at the best prices possible while extending its position as market leaders.

We are now positioned to amplify our platform advantage with unrivalled customer scale, store footprint and data,” Englebrecht assessed. “We continue to work on creating a Smarter Shoprite and using our leadership position as a ‘force for good’. We are further embracing digital opportunities and enhancing our operational capabilities. While we believe we can

still achieve organic growth in our core markets, we will continue to close the gap in the growth segments in which we are under- represented.

“We are first and foremost authentically customer-centric, guided by low prices and range in Shoprite, which dovetails with Usave to offer our core mid-to-lower segment customers value and accessibility, and choice, extended fresh offer and value in Checkers. Coupled with this is our desire to improve our customers’ experience

across all our brands and, in this regard, our strategic road map is completely aligned with our purpose: to uplift lives every day by pioneering access to the most affordable goods and services, creating economic opportunity, and protecting our planet.”

Published by CMB Media Group Chris Bolderstone – General Manager chris@cmb-media.co.uk Kiln House, Fuel Studios, Pottergate, Norwich NR2 1DX

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