South African supermarket chain shows 10 per cent real growth

South, African, supermarket, Africa, SA, Whitey, Basson

For the first quarter ended September 2010, the Shoprite Group grew turnover by 9.7 per cent in a trading environment which showed no improvement from the extremely depressed market conditions that characterised the financial year to June 2010.

Supermarkets RSA, the Group’s core business, grew turnover by 8.5 per cent while internal food inflation averaged -1.5 per cent during this period, to produce real growth of about 10 per cent.

Shoprite CEO Whitey Basson said judging by the growth in basket size and the increase in the number of customer transactions, the group believed Supermarkets RSA was able to make further gains in local market share. “However, as market share information for the food retailing sector is no longer made available, this perceived growth could not be confirmed.”


He said the global recession continued to curtail economic growth in Africa while a further surge in the relative strength of the rand placed more pressure on food exports from South Africa. The group was thus obliged the Group to source alternative products elsewhere. In constant currency terms non-RSA sales increased by 13.5 per cent and in rand terms by 2.1 per cent.

Nothing has changed in the environment in which the Group’s furniture division trades with the focus remaining on aggressive discounting in this highly competitive arena. The furniture division succeeded in increasing turnover by 7.2 per cent during the three-month period.

Other Divisions, which combine the results of the franchise division, Medirite and Computicket, increased turnover by 46 per cent mainly as a result of the acquisition of Transfarm Pharmaceutical Wholesalers at the end of 2009.      

Basson said stores were being well provisioned for the December festive season which would be the determining factor in the success of the first half of the year.

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