Massmart Not built in a day
After those iffy interims, in which profits were hit by a combo of DC openings, costs associated with the Walmart deal and pressure on Game’s credit-strapped, middle-income shoppers, one should expect a rebound from Massmart some way down the track. But not, it appears, before that leafy bend just coming into view: sales were up just 11.4% in the first eight weeks of 2013, down from last year’s more strapping 14.7%. Mr Pattison appears to be in it for the long haul, however, ruefully acknowledging the impact of the capex in his eight DCs over the past five years (billions, we’re told, somewhere between three and five of them), but pointing out that the DCs will be needed if growth is to continue over the next 10 to 15 years.
Comment: Still, with the likes of Shoprite breaking open the old war chest as Massmart intrudes more deeply into the food market, the head that wears the crown will rest uneasy for some time to come.