
THIS ISSUE: 24 Sep - 30 Sep
-
Choppies Africa is not for ciss… oh, shut up!
Hitting the inevitable pothole on its dust trek across our subcontinent this week is Choppies, which is delaying its planned store openings in Zambia and Tanzania by a few months. This notwithstanding, it should meet its target of 200 stores across sub-Saharan Africa in 2016, no problem, assisted in this plucky endeavour by a recent acquisition of ten stores from Ukwala in Kenya. Exciting times for Choppies, which is at that heady stage where each new opening brings not just footprint but also better economies of scale and more purchasing power. This pleasing state of affairs is reflected on the balance sheet, with revenue growing 19% on last year to $567 million, and HEPS up 20%. The only cloud in the Choppies’ firmament is, sadly South Africa, where its 37 stores made a loss last year, dragged down by the miner’s strike in the Northwest.
Comment: From here on in, we promise to remove the words “plucky” and “little” from our reporting on this impressive, plucky, little business.
-
-
Woolworths Australian rules
Continuing to bring a light unto the godless this week are Woolworths. Not content with teaching Australians to appreciate a well-turned cuff and to wear long trousers, The Dapper One is expanding its sustainable business model to its recent acquisitions Down Under. Over the years, as you know, Woolies has taken practical steps to reduce its carbon footprint, like automated lighting in its store and liquid nitrogen refrigeration in its delivery trucks. While the conversion has sometimes been costly, its resulted in a 40% savings in consumption over ten years, several prestigious international awards and the gratitude of a customer base which wants to buy as green as it can. According to CEO Mr Moir, these practices will be exported to the Antipodes in the interests of consistency. “We have a responsibility as a business, regardless of what the cost may be, otherwise we won’t have a sustainable planet in the long term,” he says.
Comment: You will recall that until very recently Australia had a Prime Minister whose major policy contribution was a plan to bomb the Great Barrier Reef.
MANUFACTURERS AND SERVICE PROVIDERS
-
Nampak Africa is not for c… (thwack!)
Not being one to run flapping and whimpering from a challenge, Nampak have targeted no less a share than 100% of the Angolan market for its tins. Currently, Nampak supplies about 56% of Angola’s beverage cans, and is the only operator with a manufacturing facility in-country. The balance of the cans are imported, and now the government is threatening to slap import duties on these, driving up prices and leaving Nampak favourably positioned to increase its output and snap up the rest of the market. The duties are a response to the tanking oil price, which is causing the Angolan government to rather responsibly attempt to boost manufacturing. On the downside, for Nampak, is that it is struggling to get cash out of both Angola and Nigeria as the governments of those countries seek to tighten their belts until the oil price heads north again.
Comment: There’s something touching, though, about governments taking an interest in the well-being of the economies in their charge.
-
-
Nielsen Participation medals all round
Our number-crunching colleagues Nielsen have just released their inaugural African Prospects Indicator (APi), a pioneering report which according to the press release provides existing and potential investors in Africa with comprehensive insights across an extensive range of indicators, culminating in an unambiguous ranking of sub-Saharan African countries. The APi is a trended and comparative set of metrics based on 18 months of intensive collection and analysis of detailed macro-economic, business, retail and consumer information sets. But enough about the methodology. The question on everyone’s lips is, who came second, after South Afric… what? That can’t be right! In fact, Nigeria tops the ranking, pipping us into second by… you have to be kidding. Cote D’Ivoire second, Kenya third, and if you want to find us, we’re only barely still in the top ten, at ninth. Although Nielsen kindly point out that we “cannot be overlooked,” because our economy “accounts for the largest base of consumer spend in Sub-Saharan Africa” we are “home to more than 50 million people” and we have “various coping strategies for overcoming tough times.”
Comment: Oh, good. Yay us, and our various coping strategies.
-
-
Tiger Brands Africa is not for ci… we said, shut the heck up!
We make our own luck, or so we’re told. If this is the case, Peter Matlare, an otherwise able CEO by all accounts, could use a couple of lessons. He stood down last week after reaching an unspecified agreement with the board, as the Dangote Mills deal he struck in Nigeria continues to haemorrhage money for the busy. The deal was worth about R1.5billion, of which a full billion has now been written off, with Mr M taking full responsibility. And then there was the small matter of the Haco business in Kenya, whose executives attempted to pull a fast one by submitting dodgy figures for the March interims. While the gimlet-eyed men and women in the plush leather analyst seats have expressed general approval over the move into new markets, the words “due diligence” have been bandied about in the corridors. Certainly, the punters were happy with the news, sending the share price up 4.3% just 15 minutes after the announcement.
Comment: A damned, damned shame. We wish the personal Mr Matlare all the best in his next endeavour, but urge that he not open any emails from Nigerian royalty anytime soon.
TRADE ENVIRONMENT
-
Retail Retail is not for cis… (ponk!)
According to the hoary beard-tuggers over at the Bureau of Economic Research (BER) and their grey-shoed wingmen at Ernst & Young (EY) things are going to get worse before they get better, with their latest retail survey indicating a marked deterioration in conditions in the third quarter of this benighted year. Most retailers surveyed – in the durables, non-durables and semi-durables categories – said that both sales and profitability had slumped during the quarter. While StatsSA had reported an increase in sales volumes from 2% to 3% year on year at the end of the second quarter, BER’s numbers indicate that these have retreated once more to around 2%. This as households face a range of negatives, including higher tax, unemployment, lower spending on social grants, rising inflation and interest rates, the decline of the dear old ZAR and the slump in stock prices on the JSE.
Comment: Will no one bring us some good news – yes, you over there at the back: South Africa the Good News? The Cascade Primary School cleans up Tafelsig, you say? Well, that is good news!
IN BRIEF
-
Unilever And we’re pretty sure he walked across the Hudson River to receive his prize...
The kudos keep flocking in for Unilever CEO Paul Polman, like so many doves. The gentle, peace-symbolising bird, not the body-positive, Unilever-produced bath soap, obviously. This time: the UN’s highest environmental accolade, the Champion of the Earth Award, for his efforts in leading business in a sustainable new direction. Among Unilever’s many achievements under Polman are the reduction to zero of waste to landfill across all of its manufacturing.

Subscribe to the Trade Tatler to get an up-to-date overview of what is happening in the SA and international FMCG industry
Tatler Archive
- 2023
- 2022
- 2021
- 2020
- 2019
- 2018
- 2017
- 2016
- 2015
- 2014
- 2013
- 2012
- 2011
- 2010
- 2009