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A slow news week, so what better time than to check in on Shoprite’s results for the first quarter of this FY we are pleased to call ’23. In the three months through September, sales in South African supermarkets, including LiquorShop, delivered growth of +19.9%, on selling price inflation of +8.2%. This particular period does however come off a low base, as it takes into account last year’s outbreak of civil unrest and the effect of lockdown on liquor sales. And Shoprite are far from sanguine about future growth in this difficult ambit; pointing to the impact of a fuel increase this year of 56%, and the R100m per month that load shedding has added to the diesel bill. That said, the rest of Africa looks good, up +18.8%. And back home they’ve added 46 new stores for the period, including 7 Checkerses, a Checkers Hyper, 2 Shoprites, 10 Usaves, 18 LiquorShops, 4 Petshop Sciences, 3 Checkers Little Me’s and one Checkers Outdoor.

Comment: Which in itself is a pretty good summary of the Shoprite bricks and mortar strategy.

Let’s take a quick waltz through what’s on offer this Black Friday, shall we? Black Friday, you will remember, is a consumer holiday introduced by retailers miffed that they couldn’t sell much over Thanksgiving but turkey and cranberry sauce, and also as a means to unload last year’s stock before filling up with new stuff before Christmas. It has since spread all over the world. Anyway: Checkers will be offering its standard sale of deep cuts of up to 50% on certain items, with deals published online so shoppers can plan; Woolworths has rather innovatively been running early Black Friday deals in recent weeks, unlocking more sales as Black Friday itself looms closer; Pick n Pay is playing its cards fairly close to its chest but has launched its new online Home store in time to offer deals; and Massmart’s Makro has taken a Woolies-type approach, and has been running weekly “Flaming Hot Deals” in the run-up.

Comment: How ever did we manage without Black Friday, bargain-hungry shoppers and retailers alike?

In the blasted Antipodes, Woolworths has apparently identified Anchorage Capital as potential buyers for its David Jones asset. Woolies had engaged Goldman Sachs to help it identify purchasers for the retailer; many have nibbled, none have bitten. According to Woolies, sales at David Jones were up +55% in the first 20 weeks of the year. Back home, Dis-Chem is upping its loyalty game with the launch of a new personalisation addition to its Benefit Card loyalty-programme. 6.8 million loyalty card holders will receive individualised offers that are derived from a variety of metrics and data that is collected and categorised to form individual profiles. This will help customers receive tailor-made promotions, and suppliers benefit from access to data which gives them information and insights across several categories and criteria. Back overseas now, to the low countries, where SPAR International have just released its Q3 numbers, revenue up +4% to $70m. Their Europe, Middle East and Africa segment, represented by our own SPAR South Africa, was down -7.3% to $8.9 million, but on a constant currency basis grew +8.3% from the second quarter, while gross margin grew +23.4% YoY. We’ll have more for you on our local SPAR FY results in our Tatler next week.

Comment: Some pleasing movement on the Woolies front; they’ll be pleased to exit Aus.

Over in the US, grocery sales had a rip-roaring October, rising +8% YoY and +1.4% from September, even as inflation – which contributed handsomely to the increase – showed signs of easing. Things are still pretty tight over there, relatively speaking: consumers added a collective $38bn to their credit card debt in the third quarter, a +15% YoY increase. Meanwhile over in the UK, tough times for Woolies’ friend and mentor Marks & Spencer, which grew sales +8.8% to £5.6bn in the six months through September, but saw pre-tax profits sink -23.7% to £205.5m as its online JV with Ocado went into the red, it pulled out of Russia, and held back on passing on cost increases to its well-heeled punters. Finally, to Brazil, where Carrefour’s third quarter profits slumped like a grounded teenager by -59% as high interest rates contributed to surging debt after the French retailer’s acquisition of the quintessentially Brazilian-named Grupo BIG, which it bought last year for 7.5 billion reais.

Comment: Three continents, three ways in which macroeconomics are playing havoc with retail performance. Tough times.

A couple weeks ago, we reported that Massmart was delisting from the JSE. One in, one out: Premier Foods has let it be known that it will be throwing its hat into the ring in the near future, with a valuation of R8.6bn, supported by parent company Brait, which will be flogging around R3.7bn of Premier shares to a couple of investors at a discount of somewhere between 10 and 28%. According to Brait, Premier enjoyed a 24% market share in bread, a 32% market share in flour, a 20% market share in maize and an 18% market share in total sugar-based confectionery in the year through August. “The transition into the listed environment is expected to support Premier’s efforts to drive its organic and acquisitive growth strategy and strengthen its market position across all business areas,” says Premier CEO Kobus Gertenbach. Premier, you may recall, grew revenue +16.1% to R14.5bn in the year through March. The business was last listed on the JSE over two decades ago.

Comment: A welcome return for punters wishing to invest in a solid and iconically South African business.

Quickly: What do South Africans spend at super-premium supermarkets every year? Wrong! It is in fact R146bn. What percentage of South Africans do their day-to-day shopping in the informal trade? 39%, actually. And which channel grew fastest, in 2020? That would be e-commerce, at, anyone? 95%, well done! Bonus round: name 8 hybrid big-box chains. Nice try, but these were the ones we were thinking of: Makro, Devland Group, UMS/CSH Group, Elite Star Trading, Kit Kat Group, IBC Group, and Tradeport. All of this you would know if you scanned the Trade Intelligence SA FMCG Channel Architecture report, out this week. The report provides its buyers with the channel insights they need to understand the size of prize of the channels, and rich perspective and analysis of their growth and outlook, with comprehensive channel profiles to guide aligned decision making and winning channel plans. It’s the most comprehensive and detailed document of its type currently available and given the rich complexity of the South African trade, a fascinating read in its own right.

Comment: To order your copy and skill up you team, head over Comments 0