Trade Intelligence Logo

It seems like only yesterday that SPAR was agonising over who to take to the Matric Dance and pestering us for the car keys, and yet here they are at 50, happily married to the second wife, playing golf with Sullivan O’Carroll and driving their own E-class. Let’s take that trip down memory lane, shall we? (Cue deep masculine voiceover artist): “1963: In response to the emergence of grocery chains, a group of eight wholesalers hold a foundation meeting, together with 500 potential members. The SPAR Guild is established. Control moves to W.G. Brown Limited, the forerunner of SPAR South Africa.” This, of course, from our own Trade Profiles, to which you can subscribe here if you haven’t already. But what is interesting to note is how much of SPAR’s current success it owes to that first meeting: its innovative defensive position between wholesale and retail, the primacy of its member retailers from day one, and its strong regional focus, which paradoxically gave it an immediate national footprint as it started up.

Comment: Big congrats, SPAR, and here’s to another fantastic 50.

It’s not every day that a new Makro opens. Because there would be a lot more Makros if one did. Which is why we’re telling you about this particular one, a 19,000m2 giant on a 7.7ha site in Alberton, containing under its valued, corrugated roofing over 55,000 different quality branded products. And it’s not just Mrs Joe Punter who will find her natural discount home there, oh no: Massmart are going for the larger commercial customer here, whose needs will be met in a dedicated check-out area completely separate from the retail side, with metal cages to hold stock for them overnight if necessary and a wide overhanging roof to make collection even easier. Caterers and schools and offices also will be similarly served. In keeping with Massmart’s policy (and that of its American cousin) the store will be environmentally friendly in ways as yet to be specified, and has been financed in part by Nedbank, who have already sprung for two in the past year. 

Comment: Bullish stuff from Massmart, in a strategically significant ‘hood.

…won’t you take us to the Freshstop, of which there are now 121 at Caltex petrol stations nationwide, and another 50 planned for this year. The idea is to have over 400 up and running in the next three years in a total of 800 available Caltex sites. The concept, a JV between Fruit & Veg City and Chevron, has been a huge success – it now commands over 25% of the forecourt market, and has outstripped the efforts of other supermarkets to capture the road-trip wallet and the late night munchies demographic. If you fall into the latter, and we’re not suggesting for a moment that you do, you will already have been delighted by Freshstop’s selection of comestibles, from fresh fruit and veg to grilled chicken and smoothies, as well as such premium coffee brands as Seattle and Lavazza. If on the other hand you’re merely a harried commuter, you will have noted the preponderance of FVC’s own Freshers brand which has been expanded to include major grocery items.

Comment: 400 stores. There’s a number to roll around the tongue, eh?

A bit more on P&G, its new factory and its plans for the continent we call home. The plant, as it turns out, will be built in the GP, and is P&G’s opening salvo in the escalation of the battle for Africa, a market of some billion souls which, it is estimated, will double in size in the next 40 years. And P&G, according to Dimitri Panayotopoulos, Vice Chairman: Global Business Units, is undaunted by SA’s current travails and is in it for the long haul. Although the recent past has been kind to the grocery giant, with the Africa business having grown tenfold in the last 10 years. But while South Africa, with 25% of the continent’s GDP, and most of its truly viable retailers, is the natural springboard, it’s not the only game in town – P&G has a sizeable presence in the arid north, too and is building a similar hub in Lagos, Nigeria.

Comment: Exciting times ahead, if you’re an aficionado of consumer packaged goods.

Rainbow has touched up its shareholders for capital with which to expand. Country Bird, on the other hand, has gone cap in hand to Washington DC, home of the International Finance Corporation (IFC) which is springing $25million of the variable-interest stuff, payable over five years. This will be used to increase capacity at various of its plants. Specifically, it will be upping chick production in Zambia and Botswana, expanding feed-mill capacity in Zambia and increasing broiler meat processing capacity in spits unspecified. It will also be constructing soya bean deactivation plants at two of its feed mills. The IFC, in turn, will have the option of converting the loan into Country Bird shares to a maximum of 18%. Country Bird are hoping the deal will turn into a long-term thing.

Comment: We had absolutely no idea you could deactivate a soybean. Or get money from the IFC in order to do so.

Don’t shoot the messenger, but as the BRICS meet in rainy Durbs, it’s probably a good time to get a little perspective. The original BRIC countries (Brazil, Russia, India and China) are together worth around 20% of global GDP. Add SA to the mix, and this rockets up to, let’s see, 20.55%. The economies of this sort of scale become worrisome for the likes of us. The idea is that all partners contribute $10billion to fund the BRICS bank – 11 hours worth of GDP for China, but twice the Defence budget for us. So what’s in it for our partners? A stable platform for expansion into Africa, the better to exploit the continent’s vast resources and sell stuff to its vastly under-tapped markets.

Comment: An oddly, and disproportionately powerful position in which to be. If we took our role of continental leadership more seriously, they would have to come up with a whole new acronym for the club.

“You young people think you know about large vegetables,” said Oom Schalk Lourens, tugging on his meerschaum on the stoep one sunny Tuesday morning in March. “But let me tell you this: if you had seen the great pumpkin of 2013, grown by Oom Drikus Kleinhans for the annual Shoprite and Checkers Giant Pumpkin Competition, then you would know that you had seen a pumpkin of truly impressive proportions. At 379.5kg, it was so large it barely fitted into his king cab, and he had to ask his nephew Theunis and four of his friends to help him lift it out.” He looked at us shrewdly from under the brim of his hat. But Oom Schalk Lourens was known to be the greatest liar in the Marico, so we paid no attention to him.

There’s nothing wrong with Adcock Ingram that being owned by Bidvest won’t sort out, if you believe the gentlemen from that massively diversified business, which according to a letter it sent to the Adcock board last week wants a 60% stake in the drugmaker. This, it is estimated, would set it back close on R6.5billion.