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In one of their disarmingly honest updates, Massmart have let it be known that their sales have taken a beating to the tune of -13.1% YoY in the 19 weeks through 10 May as COVID-19 limits dealing in general merchandise, home improvement, and alcohol – three critical and historically successful categories for the Group. Quoting Victor Hugo this week was Pick n Pay’s Mr Brasher, who pointed out that “nothing is more powerful than an idea whose time has come”. Mr B was of course referring to private label, which he believes “will become so much more established in times of austerity and difficulty because it’s an opportunity for people to get more for less.” Mr Hugo was referring to the French Revolution. Shoprite have donated R11m worth of surplus food to communities in need over the course of the pandemic through 230 NGOs. Also fighting the good fight is SPAR, which has donated R100,000 worth of maize to the COVID Flight Food Distribution Initiative, which airlifts food to isolated communities in Mpumalanga. SPAR have also let it be known that they’re expecting a -30% decline in earnings for the six months through March, as a result of losses resulting from the restructuring of its freshly acquired Polish business Piotr i Paweł.

Comment: Excellent work from our retailers, whether charitable, canny, or both.

Those Dis-Chem results then, where for the 12 months through 29 February revenue grew +12% to R24bn, be it mainly from new stores and acquisitions. Group earnings took somewhat of a knock mainly due to the stock rationalisation process, which saw a drop in purchases from suppliers and hence the retailer’s corresponding rebates, and after adding the effect of once-off costs to it all, margin for the year was in the red, which, of course, is not all that. The Group has its sights firmly on FY2021, however, when it hopes to continue growing ahead of the market, and then there’s this (subject to approval from the relevant authorities): the Group has agreed to purchase 100% of the issued share capital of Baby City for a princely – indeed, a princessly – R430m, in the midst of an outbreak nogal, indicating a heartening belief in the future, of their business and otherwise. The move makes sense: culturally and operationally the businesses are aligned, and South Africans insist on adding around 900,000 babies to the population every year, so a shortage of punters is not going to be the issue. For our usual snappy synopsis of the results, click here .

Comment: Nice one Dis-Chem, giving them a bit of competitive space in which to roam outside of the increasingly crowded pharmacy sector in which they currently operate.

A sea change in how business is done in South Africa, and we are not exaggerating. Last Wednesday, you see, Shoprite agreed with the Competition Commission that it would no longer enforce exclusivity agreements with malls against SMEs and specialty retailers, which may be competitive in those locales, joining Pick n Pay, which has made a similar move. The Big Red One has also agreed to immediately cease exclusivity against other supermarkets in non-urban areas, and to phase out these agreements in urban malls over five years. As you may recall, the Grocery Retail Market Inquiry (GRMI) report released in November 2019 found that exclusivity causes were depressing competition in grocery retail. Exclusivity has long been practiced by South Africa’s ‘Big Six’, covering 70% of malls, with agreements ranging from 10 to 40 years.

Comment: Good news for the little guy. Provided his or her business survives the pandemic, and there are still malls to trade in.

As job losses ramp up and grocery prices spike in the land of the free, German discounter Aldi is racking up sales with the low-cost, limited-range, no-frills shopping experience offered in its 1,900 stores nationwide. Another winner is Dollar General, with 16,000 stores, many of them in the already-depressed rural areas; both businesses are hiring even as others are shrinking their operations. Dollar General is planning on opening 1,000 new stores next year. In the UK in the meantime – and follow closely, it’s a little complicated – Tesco execs are to receive their bonuses after all, after online retailer Ocado was removed from a calculator used to decide on Tesco remuneration based on its rivals’ success. Ocado, you see, is going great guns, and its share price is accordingly headed skyward. High share price for Ocado = lower bonuses for rival Tesco. Ocado, having flogged their proprietary technology to US retailer Kroger, are now apparently more tech-focused than retail-oriented, causing the Tesco boys (and indeed girls) to breathe a sigh and casually flip open the Ferrari catalogue.

Comment: Frankly, the fact that anyone’s getting a bonus in these times is something of a miracle.

Cutting out the middle man this week – AKA, namely and viz., the retailer – is PepsiCo, which has just launched two new sites punting its products directly to the consumer. Rather than focusing on the brands which have made PepsiCo a world beater in recent years – brands such as Quaker, Gatorade, Sun Chips and Tropicana – PantryShop.com and Snacks.com focus instead on consumer needs, in categories such as “Rise & Shine,” “Snacking,” and “Workout & Recovery.” Having tested these bundles in the ether, PepsiCo might well use them as a merchandising principle in store as well, when the time is right. From concept to launch, the sites went live in 30 days, which involved some sacrifices – for example, you can’t actually buy Pepsi online as yet. We turn now to Michael Lindsey, Chief Transformation and Strategy Officer for Frito-Lay North America. Mike? “We’ve seen incredibly strong demand for our snacks during this time, and Snacks.com offers consumers another way to purchase the products they love, delivered right to their door.”

Comment: Genius. This is how you use a crisis to build a futureproof business. Wonder if PepsiCo will bring the model to their Pioneer business back here in the B.C.?

Interims out from Premier Fishing and Brands, which may be a handy bellwether for these times of uncertainty and hardship. And indeed, in the six months through February, taxed profit declined -63.6% to R20m, as revenue fell to R215m from R287m, due mainly to lower catch rates. COVID-19 has also taken its toll on Premier’s export markets. So no dividends then. Be this as it may, “The Group is in a financially stable position with no debt,” says CEO Rushaan Isaacs. “It is cash positive and we have put strategies in place to mitigate some of the losses suffered because of the pandemic.” Now to fellow-bellwether Astral Foods, which reports that profits in its six months through March were essentially flat, although headline earnings were up marginally to R369m. “The legislated minimum wage, the impact of load-shedding nationally… and costs associated with COVID-19 all contributed to a higher base cost of production during the period under review,” Astral noted.

Comment: Tough times, but our businesses are hanging in there. Long may it last.

By the time you read this, the repo rate may well be at its lowest point in 50 years, driven thither by tanking inflation, declining consumer demand and the prospect of the deepest recession in a century. About inflation: the Reserve Bank’s targeted band is 3-6%; currently we’re at an anticipated 2.8% for the year as the price of fuel bottoms out and SA’s consumers stay home amid the pandemic. And home, says McKinsey, is where they’re going to stay. According to a new survey, the sharp-suited say, 81% of South Africans said they were either uncertain or pessimistic about the country’s economic recovery after COVID-19, compared to 72% in March, with 89%, saying they believed their personal and financial implications of COVID-19 would last past two months and 22% beyond a year. 60% say they’ve experiences a loss of income during the crisis, and expect to cut back aggressively on spending in all categories except groceries and home entertainment.

Comment: Although to be frank, we would have put that 60% much higher when it comes to cutting back on spending.