Shoprite Holdings Limited is an investment holding company whose combined subsidiaries constitute the largest fast-moving consumer goods (FMCG) retailer on the African continent and the Indian Ocean Islands, with operations in 15 countries.
The company’s headquarters are in the Western Cape province of South Africa. Shoprite Holdings Limited is a public company listed on the Johannesburg Stock Exchange, with secondary listings on both the Namibian and Zambian Stock Exchanges.
The Group’s primary business is food retailing, with offerings extending to a broad range of goods and services including household products, furniture, pharmaceuticals and financial services amongst others. At the heart of its offering is an unwavering dedication to providing the lowest prices in a world-class shopping environment to people of all income levels across Africa.
In the previous financial year in which the durability of many companies has been tested, Shoprite’s unwavering attention to it six drivers of growth which include a customer first culture, growing LSM 8 – 10 share of wallet, developing private label, a stronger franchise offering, leveraging its African advantage and strategic footprint expansion has enabled them to show strength and resilience and has fortified its solid foundation for future growth. For instance, Shoprite’s stand-out success over the past year was growing high-LSM share of wallet, which proved to be an invaluable strategic decision in a deflationary environment. Moreover, continued improvement in its private label offering enabled it to bring better value to customers which was reflected in the groups increased profitability.
The Company has identified a broad range of growth vectors, spanning new geographic regions, market segments and products ranges, as well as alternative business formats. Shoprite intends to seize opportunities across all these dimensions, while always remaining true to its core promise-on the delivery of low prices and a world-class shopping environment in every region it enters.
The Company is confident that the competitive advantages inherent to its chosen business model, as well as the strategies implemented to drive growth, will continue to deliver sustainable value creation for all stakeholders for the next 40 years and beyond. Moreover, Africa’s population is set to double to 2.4 billion people by 2051, with a growing middle class forecast to reach 1.1 billion people by 2061. 25 million people are moving to cities each year. This implies that by 2030 Africa’s top 18 cities will have combined spending power of $1.3 trillion. As the largest retailer in Africa, the Shoprite Group is well positioned to capitalize on this opportunity.
Nevertheless the much improved recent performance in Shoprite’s core Supermarkets RSA (Republic of South Africa) division, which generates 74.9% of its sales grew the second quarter sales by 7.4% despite it been a testing and challenging year. A constrained economy, inventory shortages post-industrial action and the implementation of a new enterprise wide IT system across its store base resulted in lost sales.
With affordability remaining the top priority for its customers, “Shoprite unquestionably stood by its lowest price promise”. However, ongoing forex shortages, currency devaluations in Zambia and the aftermath of rampant inflation in Angola and its ongoing impact on affordability took a further toll on our Non-RSA business. According to their group results for the year ending 30 June 2019 the “Non-RSA Supermarkets” reported a trading loss of R265 million for the year. Despite no foreseen respite in short-term trading conditions in the region, Shoprite remains committed to its customers in the 14 Non-RSA countries in which it operate as Africa’s leading food retailer.