Good news for the little guy in KZN, but perhaps not for the existing wholesalers which serve them, is that the Provincial Government in that green and hilly region have opened something they’re calling a Bulk Buying and Warehousing Programme – basically a large warehouse in Mandeni, from which independent retailers will paperlessly order goods at preferential prices, and receive free delivery. This will enable them to compete with the buying power of the major retailers, and with the foreign-owned independents that seem to enjoy greater success in forming buying groups than do locally-owned businesses. Says MEC for Economic Development, Tourism and Environmental Affairs, Sihle Zikalala “We … view Bulk Buying as a crucial pillar of economic transformation and an important step in revitalising township and rural economies.”

Comment: How do we feel about the involvement to this extent of Government in commerce? Anyone?

Yes, we know, we covered the Massmart results a few weeks ago. But with Massmart being the most diversified of South Africa’s major retailers, a closer look is perhaps instructive for other businesses struggling under the current economic climate. Massdiscounters, of course, was a wash, with sales down -1.2% to R19.7bn and trading profit 91%, to R32.6m, on the back of the yet-to-be-proven move of head office to Joburg. Massbuild, generally a reliable source of both sales and profits, saw its bottom line flatten under depressed consumer demand. Masswarehouse – that’s Makro and Fruitspot to most – grew sales +5.4% to R28.8bn, but trading profit fell -12.4% to R1.1bn, in the face of high costs growth of +9.2%, and stock control challenges off the back of the strong move to fresh produce, with unexpected additional stock losses for which 20 people including managers were given their marching orders. Some good news from Masscash (Rhino, Jumbo and Cambridge), where comparable sales grew +2.1% to R28.7bn, and comparable trading profit +48.4% to R188.6m, on good expense management and what we trust is the beginning of the ship turning for the division that competes most strongly with the powerful independent wholesale and retail trade.

Comment: At a time like this, control of expenses through efficiencies is (almost) everything.

I’m too SA-csi for my surveySo the results from research outfit Consulta’s annual SA Customer Satisfaction Index for Supermarkets (SA-csi) are in and they may surprise you. Woolies, which is often a word used these days in close proximity to the word “embattled”, retains top slot in overall customer experience, albeit with a smaller margin, at an overall score of 80.6. In second place, a slot it shares with Checkers, is SPAR, climbing impressively, at 77.8. Then Pick n Pay (75.7) and Shoprite (72.6). SPAR scored well across the board, improving in areas like convenient location, freshly prepared foods and customer engagement. Checkers improved in the areas of in-store presence and packaging, where Woolworths once enjoyed unassailable dominance. We’re going to hand you over to the experts now. SA-csi Founder Professor Adré Schreuder? “The context of retail has evolved rapidly to extend across bricks and mortar experience to online and digital presence, while consumer drivers such as value, time, experience, healthy eating and ethical living are all culminating in a continuum of disconnect between shopper expectations and the retailer’s ability to satisfy them.”

Comment: As neat a summation of the state of the formal retail landscape as we’ve seen for a while.

“Whither Siqalo Foods?” you ask, with a creased brow. What? You don’t? Ah yes, quite. Siqalo Foods, you see, is the business under which is housed the old Unilever spreads division, comprising such venerable brands as Rama, Flora, Stork and Rondo, acquired for a tidy sum by Remgro last year. Responsible analysts have argued that the business would fall neatly under RCL FOODS, which is seeking to diversify the heck out of the “cyclical” (read thankless and chaotic) poultry and sugar sectors. Question is, how would RCL buy what is, in effect, a R6bn business without a rights issue, at a time when the share price has seen better days?  We leave that one up to the fundi’s. Also, Remgro have a proven preference for keeping a stable of lithe, skittish and agile unlisted acquisitions.

Comment: Still and all, RCL is a business which does much right strategically, and should fly.

The only brewer visible from space, AB InBev, which operates in 50 countries and has 500 brands under its straining belt, turned in an OK set of results for the year through December 2018, with sales up +4.8% and EBITDA up +7.9%. But things are looking a little shakier for them here in the Brew-loved Country, where they complain about a tricky macroeconomic and consumer environment, and the same went for Argentina and Brazil. On the upside, their premium portfolio continued to grow by triple digits and picked up 10 percentage points in the high end segment. Speaking of which, the business continues to receive flak for its efforts to grow by acquisition in the craft brew segment, where it now owns once-respected brands such as Goose Island and Devils Backbone. Bearded beer bloggers everywhere are truly letting them have it.

Comment: When the big guy comes knocking with a sackful of cash, do you consider the hoppy purity of your limited-run IPA? Or the old bottom line? Look deep into your soul, my friend.

While the rising prices of fuel and electricity, and a +40% increase in the price of maize, combined with a weaker rand, could have an impact of food prices, the consensus among experts (and by experts we mean economists) is that food inflation should remain moderate for the next while, at around 5%. Reserve Bank Governor Lesetja Kganyago believes it will tick up to 5.9% next year, however. Food, as you know, makes up around 16% of the overall inflation basket, but its impact is felt disproportionately in the wallets of poorer South Africans. In welcome news from the Reserve Bank this last week, they have as expected decided to keep the repo rate at 6.75% for now. And in other moderately good economic news, Moody’s have held off on junking us by skipping March’s decision and keeping us at a Baa3 rating, which means we’re still investable.

Comment: Delicate times, but we may be slowly piecing together a foundation for eventual return to growth.

Carrefour has opened its first “drive piéton” or “walk-in drive” in Belgium. This is a concept, popular in France, whereby you order stuff online at hypermarket prices, then walk to your local pickup point to take delivery. It’s aimed at non-driving urban dwellers, and presumably in France each delivery comes with a baguette and a string of onions. Over in the USA, in the meantime, German discounter Lidl has opened its first Express mini-store, attached to the company’s US headquarters in the sterile streets of Arlington, Virginia, a stone’s throw across the Potomac from the nation’s Capitol, if you like a bit of local colour.

Big up to Pick n Pay, which got the jump on April Fool’s prankage this year by offering punters the following: “Today, we’re bringing you the future of shopping. Our new TasteTech technology uses your phone’s feedback to generate in-app tasting – an African first! Try it out now on the Pick n Pay app.” They backed it up with some waffle about how the technology had taken two years to develop, and finished it off with a classic launch video featuring great deadpan delivery by HO Staff. Classic.