School of Retail
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THIS ISSUE: 08 Jul - 13 Jul
Pick n Pay has specifically said that the retrenchment of 8% of its workforce – a move which will affect all echelons in the business, including middle and senior management, and is the first forced retrenchment in Pick n Pay’s 43 year history – has nothing whatsoever to do with competitive pressure from Walmart. Cosatu blames the cuts squarely on the ‘Walmart Invasion’, in blithe and wilful ignorance of the perfect storm of factors which has affected The Big Blue’s performance in recent years.
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nkosipeter14 July 2011 (07:54:57 PM)The PNP business model of making suppliers pay for everything has finally failed. It was highly inflationary for the food industry as it forced unnecessary costs on to suppliers who duly built it into their pricing and passed it on to all their retail customers. It did not serve consumers well, but was highly lucrative for shareholders, until now.
Outrageous14 July 2011 (02:06:55 PM)I agree - as the Tatler writer says - it's an outrageous and opportunistic assertion on the part of Cosatu. How on earth is it possible for the 'Walmart effect' to work retrospectively? Has Cosatu looked at Pick n Pay's margins in the past two years? Pick n Pay is overstaffed and has had little choice but to make this call - Walmart or no Walmart.
Whew!!!14 July 2011 (09:22:46 AM)This cannot be as a result of poor trading because Walmart has taken market share. Not so soon! if the retrenchments were because of Walmart, it implies that Pick n Pay are strategically planning for failure!
Clicks may shortly be in a position to offload non-core asset Musica, which as a purveyor of music on small plastic discs in this age of Facetube and streaming online digital mpegs occupies the position of a mechanical pianoforte in the age of the gramophone. Who might relieve Clicks of the Musicoleum? A consortium led by Ken Modise, ex of the now defunct MFP, with discussions now reportedly “at a sensitive stage”.
Clicks is going into Botswana, and not in the upmarket-safari, let’s-go-to-the-Okavango sort of way. Nought bru. They have just opened the first Clicks in-country, in Gaborone’s Game City. At first glance, it does not appear to be putting a pharmacy in-store, although it will offer the time-honoured mix of home, health and beauty, as well as the ClubCard programme, and the recently launched Babyclub.
Coke has just announced, somewhat momentously, that it will be opening a plant for the bottling of Valpré in the scenic mountain village of Heidelberg, and that it will be introducing its PlantBottleTM packaging to Africa. The new Valpré plant will be run almost exclusively by a team of black women, in keeping with its ‘5 by 20’ pledge to empower 5 million women by the year 20. The PlantBottleTM, in the meantime, is made up of 30% organic material and is 100% recyclable.
Sovereign Foods has let it be known that it will be focusing its sales efforts on bringing to market a more profitable mix of products which are less vulnerable to competition – value-added products, in other words, which it will be in a position to produce by the ton for sale predominantly in the Eastern Cape when its retail pack section is commissioned in May. In this regard, they follow in the three-toed, sharp little footsteps of Rainbow, who have been in the value-added game since the year 5.
Business Report 05/07/11
In other blame-Walmart news, the market for SA retail shares has headed west somewhat since the new sheriff rode into town. Don’t take it personally lads, one of the reasons for the earlier bonanza was that the punters were betting on just who would be bought by Walmart. Now they know, it isn’t so much fun anymore.
The Times 08/07/11
Speaking of punters, the performance of the Foster’s share, which rose 15% the day after SABMiller offered to buy all the beer in Australia and has been trading briskly since, indicates that the sharp-suited men with their pencil moustaches who loiter smoking cheap cigarillos in the corners of the world’s stock exchanges believe that SABMiller might come back with a more golden, bubbly offer. This as the standoff enters its fourth week.
Swiss food giant Nestlé has announced its intention to purchase for US$1.7 billion 60% of Chinese confectioner Hsu Fu Chi which we in our ignorant, arrogant western way thought was the punchline to a joke. Hsu Fu Chi brings to market a stable of products aimed at the Chinese consumer. The acquisition, says Nestlé, would complete its portfolio in that vast, ancient and inscrutable country.
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