THIS ISSUE: 23 Mar - 29 Mar
YOUR NUMBERS THIS WEEK
RETAILERS AND WHOLESALERS
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Woolworths Fury Road
Woolies is combining its antipodean assets in what promises to become the biggest Aussie super-group since ACDC. The idea is to combine David Jones and the fashion brands under Country Road into a single structure, which will up the labour force by 200 but otherwise add the efficiencies that come with group functions while allowing the brands independence. This after the announcement last year of the relocation of both businesses onto a single Melbourne campus. The new structure will be headed up by David Jones’ John Dixon as CEO.
Comment: It is fondly to be hoped that the restructuring puts Woolies back in the driver’s seat of the speeding road train that is David Jones.
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Pick n Pay Mmmmmm.
Bit of a minor reshuffle in Swaziland for the Big Blue: four franchise stores previously owned by the Foster family have been bought by a consortium consisting of African Alliance Private Equity (AA) and Greystone Partners, and put under total Swazi ownership. The stores in question – brace yourself for a flock of m’s, flying into the sunset like hadedas – are as follows: one in the Mbabane Mall, two in Matsapha, at Mahhala and Mashayitafula, and one in the Manzini Hub. Greystone partners is owned by a lot of the local pension funds, so the benefits of the acquisition will filter down. A Mr Peace Mabuza of AA sees the move as part of Swaziland’s transition from a traditional rural economy to something more upmarket. Retail growth there in the last four years has outpaced GDP, which, sadly is more than can be said across the border.
Comment: South African retailers are widely regarded as signifiers of growth and progress across the continent – not a role to be taken lightly.
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Shoprite X marks the spot
People in Nigeria – and elsewhere in Africa – are understandably hurt and angered by outbreaks of xenophobia here in the Beloved Country. This has repercussions for the businesses who trade elsewhere on the continent. Like Shoprite, in Nigeria, where a protesting mob had to be restrained by the local police from giving South African nationals a taste of xenophobic medicine. There have also been calls for businesses like Shoprite to be turfed out of the country – calls which alarm mall owners and smaller retailers alike, who depend on the business to bring in punters in their role as anchor tenant. There are also those who point to Shoprite’s contributions to local sourcing and employment. And Shoprite itself, which condemns xenophobia in the strongest possible terms: “We remain committed to working with industry and the appropriate consumer groups so that decisive actions are taken against those involved in violent crimes and intimidation against foreign nationals as well as to convey our strong position against xenophobia”, says management.
Comment: Business is not part of the problem when it comes to xenophobia, which results from a toxic combination of ignorance and a lack of opportunity. But business can be part of the solution.
MANUFACTURERS AND SERVICE PROVIDERS
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Agriculture The meat from Ipanema goes walking…
So here’s how it went down: the Brazilian gendarmerie, with their slightly too tight-fitting uniforms and flashy shades, accused Brazilian meat producers of bribing inspectors to allow sales of rotten and salmonella-tainted meats, including poultry. Getting wind of it this side of the pond, the charmingly-acronymed Department of Agriculture, Forestry and Fisheries (Daff) put a stop to all imports of meat from Brazil. Just like that. Finish and klaar. And all meat coming into our ports would receive the special attention of our local authorities. Brazil is the biggest source of imported poultry here, providing 41.7% of the 560,000-odd tons we imported in 2016. Even the Association for Meat Importers and Exporters of South Africa (Amiesa), normally a fan of Brazilian meats, thinks the ban is a good idea.
Comment: Respite for our local poultry industry? Have a look at the RCL and Astral share prices...
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SABMiller Did you spill my pint?
Ay okes, now’s your chance ekse. SABMiller are hiring again after too many ballies took a package in January. ABInsomething, the new owners, have announced plans to open two new production lines here in the Beloved Country, and are needing 100 something managers and others to replace the ones now kicking their heels at Fancourt and Plett. In particular demand are those with some experience in the legal, corporate affairs and finance departments. This – rather intriguingly – despite the fact that insiders have let it be known that the world’s most pointlessly large brewer needs to lose more positions to run at optimal efficiency – a fact SABwhatever disputes. There are also murmurings that more white managers remained, leaving the business with a skewed employment equity position, something it would seek to rectify if this were the case, which it says it is not.
Comment: Mergers and nastiness are never far away from each other.
TRADE ENVIRONMENT
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Inflation Pffffffttttt.
Good news for the embattled South African consumer is that the inflation rate tanked to a six-year low for the month of February, to 6.3% from January’s 6.6%. 5.2% if you disregard food, petrol and energy. It was driven thither by a surge in mining exports, which has a comforting ring to it. And while meat prices may head north as farmers rebuild their herds after the drought, lower bread and cereal prices should keep food inflation on an even footing. Overall, the trend appears to be downward – will this encourage the dear old Reserve Bank to do us all a solid and drop the repo rate? It will not, according to economists, the only people in the world, with sports journalists, who are actually paid money to be wrong as often as they like.
Comment: And don’t forget that 6.3% is still above the government’s 3-6% targeted band they’ve been banging on about as long as we’ve been writing the Tatler.
IN BRIEF
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Pick n Pay Happy birthday to you … and you … and you …
To mark its 50th birthday celebration (and let’s face it, get some feet through the doors), Pick n Pay is splashing out R500million on cutting prices on 1,300 essential items. This as beleaguered consumers see their disposable income shrink in real terms for the 8th consecutive month. Nice One, Big Blue.
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Walmart What are you doing, Dave?
This just in from Bloomberg, couldn’t have put it better ourselves: “Wal-Mart Stores Inc. is creating a technology-startup incubator in Silicon Valley to identify changes that will reshape the retail experience, including virtual reality, autonomous vehicle and drone delivery and personalized shopping.” This veritable Roswell of retail will rejoice in the Arthur C. Clarkeian name of Store No. 8, and is being called a “tech incubator” which isn’t actually a real thing.
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