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Massmart’s 100% acquisition of online delivery outlift WumDrop is complete, and this is apparently more than a mere formality. For starters, the integration of WumDrop into the business will enable Makro to speed up its delivery time from five days to two, to punters living within a 30km radius of their nearest Makro. WumDrop’s proprietary tech enables Makro to fulfil orders directly from stores, rather than involving a distant DC. WumDrop earned its reputation back in 2017 when it offered the capacity to deliver packages throughout South Africa based on the shopper’s smartphone location rather than a physical address. Knowing a good thing when it saw one, Massmart acquired a majority stake in the business shortly thereafter. In other Massmart news, the Group has noticed a shift in consumer behaviour in these difficult times. “Massmart has seen an increased interest around its private label products across all customer segments and will continue to invest in these areas,” says Group Private Brand Vice President Clyde Hill.

Comment: Massmart is striving diligently to meet the challenges of the times.

It often escapes our notice, but SPAR South Africa is perhaps our most international retailer – part of a vast global network, and with its own holdings in the UK and Ireland, in Poland and in Switzerland. So fitting, then, that we check in with the SPAR International business to see how things are ticking over – we’ll have a look at the local business next week with the announcement of its half year results. But back to the umbrella business, and as it happened, SPAR International released its results a couple weeks back, revealing, inter alia, that it had broken that critical €40bn barrier for the first time, with revenue up +3.3% to €41.2bn for the year through December 2021, and is was trading out of 13,623 SPAR branded stores across 48 markets in five regions globally. Not bad for a spry 90-year-old, which milestone SPAR celebrates this year. It’s also celebrating the launch of its first stores in South America, having recently signed a partnership agreement with a family-owned outfit Los Jardines in Paraguay. It’s also extending its reach in Europe this year, launching in Latvia, and establishing SPAR Central Asia with the opening of stores in Kazakhstan.

Comment: A nimble yet robust model, much like our late grandmother’s Ford Escort which we were privileged to drive for some years in the late 1980s.

To Food Lover’s Market first who, pouncing enthusiastically on the trend of traditional African foods marketed in formal retail outlets, are stocking a range of eight traditional teas developed by Setšong African Tea Crafters, inspired by brews made in founder Nondumiso Phaahla’s home district in Limpopo. Next up, Shoprite and Checkers are kicking off their 30th annual Championship Boerewors with the announcement of many large cash prizes and the traditional bakkie up for grabs. Watch this space. Finally, Woolies believes that shopping here in SA is becoming increasingly digital as punters migrate to platforms such as Tiktok and Instagram for their retail needs. Accordingly, the business is positioning its social media platforms as an ‘extension of its marketplace’ through new tools such as ‘virtual try-ons’, and ‘phygital’ shopping. This integrates its social platforms with its physical outlets through an in-store InstaShop, letting shoppers browse their digital friends’ favourites on Instagram, while physically browsing inside a Woolworths store.

Comment: For much more on the state of digital retail in our innovative country, look out for the excellent Trade Intelligence E-Commerce report out soon.

In the UK, Mark’s & Spencer CEO Steve Rowe has warned that sales are likely to flatten later this year after punters come back from expensive summer hols, and after spending all their pounds on mugs commemorating Queen Elizabeth the II’s platinum jubilee. Currently, he says, costs are rising in the region of +5 to 9%, and this is going to be passed onto consumers sooner or later. In the US, results posted last week by retail giants Walmart and Target indicate that both seriously overestimated the amount of stock they would be offloading onto consumers, leading to unexpected markdowns. This, say analysts, could reflect the changing financial realities for mid- to lower-income households in the face of high inflation, and may be an early indicator of recession. Also in the US, a Hepatitis B outbreak has been linked to strawberries sold under the FreshKampo and HEB brands and sold at such respected chains as Trader Joe’s, Walmart, Aldi and Safeway.

Comment: Stay safe out there people, and to your growing list of things to worry about you may now add Hepatitis B from strawberries.

Is the baby formula shortage in the US going to affect the parents of littluns here in the Beloved Country? You’d think so, because well, America. But let’s ask Nestlé, who produce mountains of the stuff. “In South Africa, we currently have enough stock to meet the current demand. We do not anticipate risks to supply in the near future,” says Saint-Francis Tohlang, Nestlé's Corporate Communications Director. Whew. Moving on, PepsiCo’s Kgodiso Development Fund has announced two new investments totalling R28m to support emerging farmers in the raisin industry: a R12m investment (for the first year) to establish a Vine Academy and Model Farm in Kakamas (is that in the Caribbean? No, Ed.), in a partnership with Raisins SA; and R16m in loans and skills development to boost the raisin production of three emerging farmers. Finally, Tiger Brands has come up with a growth strategy for its Albany bread business, which has seen consumption decline by 5%. The strategy is a cross-cutting approach, which includes filling all manager vacancies at its bakeries, appointing a revenue management team to help with the turnaround, and introducing different loaf sizes to deliver better value to consumers.

Comment: Tiger will not be the only business forced into turnaround mode in the difficult months to come.

The Producer Price Index – which provides a fairly solid read of what inflation might be barrelling down the track towards us – was released by StatsSA last week, and the news is not great: factory gate inflation surged to +13.1% year-on-year in April from +11.9% in March, the highest for the indicator in over 13 years, and portending worse inflation for consumers in the months ahead. To calm CPI – which at 5.9% is at the upper limit of the government’s targeted band – the South African Reserve Bank hiked its key repo rate last week by 50 basis points to 4.75%, bringing the prime lending rate to 8.25%. Also from StatsSA, the official unemployment rate decreased by -0.8% to 34.5% in the first quarter of 2022. The unemployment rate according to the expanded definition decreased by -0.7% to 45.5%. The danger for our economy right now is stagflation, a persistent combination of poor growth, rising prices, and high unemployment.

Comment: For more on the likely impact of rising prices on our industry, be sure to attend this indispensable Trade Intelligence Webinar.