
THIS ISSUE: 12 Aug - 17 Aug
RETAILERS AND WHOLESALERS
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SPAR Days of thunder
Here’s an idea for anyone wishing to save a buck and do the right thing by the dear old earth: drive slowly. This typically simple, but just as typically ingenious idea comes to you courtesy of our friends at SPAR, who are giving it a try in the Western Cape. There, their fleet has achieved remarkable savings, going from 44 litres per 100 kilometres to 32 litres in the last four years, and racking up 15 million accident-free kilometres over seven years. The plan, inspired some time ago by a sharpish hike in the price of diesel, focuses on a combo of driver behaviour and technology usage to achieve its goals, with drivers handsomely incentivised to drive slower and more safely.
Comment: Excellent work. Now if SPAR could also convince everyone on the planet to stick to two kids per family, we might get somewhere as a species.
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Woolworths Fury Road
It has begun. In the parched and starving Antipodes, with their blasted mudflats and ravaged, deserted cities, Woolworths Holdings Limited has taken its first bold steps into Food and Grocery Retail. Woolies supplier In2Foods, which sells prepared foods to the South African business, has apparently entered a JV with Victoria’s Yarra Valley Farms, a fresh produce wholesale supplier, and is apparently looking at establishing a production facility in Bankstown, New South Wales. All of this with a view to bringing premium foods into the mix at the hideously-named Woolies-owned retailer David Jones. “We are building the business, we have got some of our suppliers from South Africa who have come over and they have invested in joint ventures in this marketplace, we are building a supply chain, we are employing people, we are putting a team together,’’ confirms Ian ‘Mad Max’ Moir.
Comment: And once we’ve sorted out grocery retail, we’re coming after Super Rugby.
MANUFACTURERS AND SERVICE PROVIDERS
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Sea Harvest Water, water everywhere
Here’s some good news for fans of slimy things which crawl with legs upon the slimy sea, to quote our old mucker Coleridge: South Africa’s Sea Harvest have managed to acquire a controlling interest of 56% in vertically-integrated Aussie agri-business Mareterram, which counts among its assets a fleet of ten prawn trawlers. The business is the largest holder of prawn licenses in Western Australia, and plays merry hell with wild populations of King and Tiger prawn and is certified by the Marine Stewardship Council. The move brings Sea Harvest closer to its own goal of becoming a vertically integrated agri-business, which is quite the thing to be these days. And speaking of acquisitions, you will recall that an 85% controlling interest in Sea Harvest was recently acquired by Brimstone Investment Corporation, which makes it one of the most transformed outfits in the industry.
Comment: To a certain palate, Australian prawns might taste like victory, especially when enjoyed with a nice South African sauv. blanc.
TRADE ENVIRONMENT
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Consumer Sentiment Mind the gap
It is a truth universally acknowledged (to paraphrase Ms. Austen) that a South African consumer in possession of a large overdraft must be in want of a shopping experience. This has now been confirmed by Nielsen, who have discovered that consumer sentiment is at odds with spending behavior. Thus while the Nielsen Consumer Confidence Index (CCI) figure is bumbling along at just 78, just 3 or 4 points above its level during the Great Recession, annual spending is up by 9% and overall pack sales by 4%, where during the Recession all categories were deep into negative territory. In part, says Nielsen, this is due to the strategies of retailers and manufacturers alike, who have been astute in keeping prices down and punters interested through this difficult period. Other factors are at play though – inflation is running at around half of what it was back then, and shoppers are shopping more sharply.
Comment: A fascinating picture of an often impenetrably complex market.
IN BRIEF
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Woolworths The high road
At the conclusion of their first three-year collaboration, Woolies and the World Wide Fund for Nature (WWF) have announced the inception of a second partnership, this one aimed at improving the stewardship of water resources nationally; exploring low carbon pathways; reducing the potential negative impacts of agriculture; improving seafood and in particular aquaculture sourcing; and reducing food waste throughout the supply chain. Partnerships between business and advocacy groups are the future.
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Walmart But they can still go shopping in their underwear
Walmart is taking the war to Amazon with the proposed acquisition of the delivery giant’s downmarket competitor Jet.com. Problem is, Jet keeps its prices low by avoiding sales tax in states where it doesn’t have a physical presence; the danger is that acquisition by a business with a physical presence everywhere will lose it this advantage.

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