School of Retail
"The Trade Profile book is our ‘bible’"
THIS ISSUE: 07 Oct - 13 Oct
The Times/Sowetan Retail Awards results are out, and the big winner is Shoprite, who took gold in all five categories in the grocery section, viz: overall customer experience, supermarkets and hypermarkets, and stores used for daily, weekly and monthly shopping. Economies of scale did not hurt the Big Red One, which now claims 16 million individuals frequent the stores under the actual Shoprite brand. Second was of course Pick n Pay, third SPAR, forth Checkers, and in a very creditable fifth, Boxer Superstores. TOPS at SPAR won hands down in liquor, pipping Ultra and Pick n Pay for the honour, and claiming that the recession turned out not to apply to them at all. The Awards are run by TNS Research Surveys, who canvas a range of punters for their views on the subject. Comment: Awards eh. Where would the PR ladies be without them. And the gents, of course.
Tatler Reporter 11/10/10
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New in Added Value: Pick n Pay’s new courier service, run by Berco. Basically, Berco has installed drop boxes at 50 Pick n Pays around the country, with more to follow, and the time-strapped punter can dash in, buy a Drop-Box Retail Pack from the kiosk for a flat fee of R99.99, follow the basic instructions, fold, stick and drop, and Bob is your Uncle in van Reenen, whose birthday you had almost forgotten. It’s an overnight service, with delivery before 10.30am the following day in major centres, and is based on a popular model in the US of A, where one popular business has 40,000 drop boxes all over the show, and Tom Hanks in a beard. Comment: One size, one price, no account: genius on the part of PnP in the drive to offer convenience to customers, and a sweet deal for Berco too, one imagines.
Simply Links 07/10/10
Last year, Massmart acquired the 22 stores of Cambridge Food, amid relatively muted fanfare. It was mooted at the time as a strategic acquisition, heralding The Young One’s formal dip into the enticing waters of retail cash ‘n carry, and headed up by the dynamic Jay Currie, formerly Group Commercial Director. Turns out, intentionally or no, that it was a very good move indeed – that the brand was a “big deal” for the dealmakers of Walmart, as a possible vehicle for the rollout of retail into Africa. The plan in any case was to grow the chain into 100 stores over the next five years, sticking to the strategy of competitively priced supers located near busy commuter hubs. Comment: With Walmart’s buying power, Cambridge could find itself transformed from new Kid on the Block to Justin Timberlake himself, and a serious threat to the shall we say more established players. Even though Justin wasn’t an NKOTB at all.
Inspired perhaps by fishing apocumentary® The End of The Line, the Big Blue has signed a partnership agreement with WWF’s Sustainable Fisheries Programme in support of the organisation’s Sustainable Fisheries Programme. The three-year partnership agreement is worth a total R6.1million and aims to restore over-exploited fish stocks to sustainably managed levels, whilst maintaining or improving the state of other stocks, through the application of an Ecosystem Approach to Fisheries (EAF), and reducing the impacts of destructive fishing practices to acceptable levels. It will achieve this in part by assisting its shoppers in making informed purchasing decisions. Comment: Pick n Pay is the one retailer which can be relied upon to quietly do the right thing, without quite as much brouhaha as some of the others, ahem, seem to generate from simple acts of kindness.
Tatler Reporter 12/10/10
SABMiller just might exercise its right of first refusal over the assets of ancient, French family-owned brewer, the serendipitously-named Groupe Castel, in which it already owns a 20% stake. The word on the street is that The Boss is in talks to acquire the remains of Castel for £6billion. It would be a great buy – Castel produces three times as much beer in Africa as SAB does, and has excellent exposure to Africa’s younger, faster-growing markets – this as SAB loses volumes in Lesotho, Swaziland and Botswana, where it sells 20% of its beer. Groupe Castel, in the meantime, is dismissing reports of the talks with a huffy Gallic shrug. Comment: We of the Tatler, in the meantime, will raise a tentative glass to the successful conclusion of le deal.
Business Day 08/10/10
The worst drought in 15 years is causing more than the usual distress among sugar cane farmers, particularly on the KwaZulu-Natal coast, where evidence of a sinisterly named condition known as cane root mortality has been detected. This means that instead of just letting it grow from existing roots, the polo-playing Mauritains are going to have to replant the stuff all over again. Problem is: no cash. This means banging on the door of the dear old Land Bank, and asking for a loan at reduced interest rates, something the SA Canegrowers Association is doing as we speak. It may interest you to know that of the 35,300 registered sugar cane growers, 33,700 are small scale farmers who really could use a break. Comment: A tough year for an industry which knows its share of peaks and troughs.
Business Report 07/10/10
In the UK, where until recently High Street was eerily deserted and packs of feral dogs roamed the malls, a study has found that consumers have abandoned ethical shopping patterns in the face of the Great Decession. According to Shoppercentric, 65% of them have said that they wouldn’t pay more for environmentally or socially friendly products if the taste or quality wasn’t better (although what that has to do with the economy beats us). And to be fair, the numbers supporting ethical shopping are still impressive: 30% are trying to shop more locally, 9% are trying to buy British, 49% are shopping ethically for toiletries, and 65% of the under 25s are keen to buy environmentally friendly products and services. And only 3% of all of them claim not to be recycling. Comment: So it’s not quite dog eat dog, then.
Headmaster Gordhan would like to see the following currencies after assembly: the Rand, the Real, the Baht... Turns out the rand really is too strong and it’s hurting us. Why is it so strong? Shifty-eyed foreign money is coming after our attractively buoyant interest rate, that’s why. Low interest rates in the developed world have sent them scurrying for a better return on our welcoming shores, to the detriment of our manufacturing and export sectors. The IMF believe that our currency is 5-15% overvalued, while Cosatu, who very often turn out to have a clue, believe it is a major contributor to our worsening unemployment rate, now at an official 25.3%. Comment: An ex Minister of Trade and Industry once mentioned to us that the rand was a currency which could be pushed around. Apparently, it still is.
City Press 10/10/10
While the economists down at the off-course tote are nursing their inexpensive whiskies and muttering direly about a double dip recession, signs in the UK indicate a recovery of sorts in retail. Tesco, for example, beat gloomy predictions with a 14% rise in underlying profits for the first half of the year, and believes that its loss-making Fresh & Easy venture in the US will turn the corner sooner than expected. It also believes that demand in the developing world (it operates in 14 countries) will help everyone. And over at Sainsbury’s, third-quarter results at the top end of predictions, and a growth in online sales, premium and non-food products indicate that everything is pukkah there too. Comment: Nice one, geezers.
Business Day 07/10/10, 08/10/10
Unless it was an elaborate (and expensive) ruse, or ploy, Massmart executives apparently really didn’t know about the Walmart offer in advance, if their most recent transactions are anything to go by. On the 31st of August, Grant Pattison disposed of 86,000 shares at R122 per, while Financial Director Guy Hayward got shot of 175,000 of the pretty things, for a total of R21.3millions. When it made its offer, Walmart, you might recall, was offering a substantially more princely R148 per share...
Speculation in the financial press is that Pioneer Foods may be looking to dispose of an asset or two to cover the costly cost of its Competition Commission fine. On the menu, say certain irresponsible hacks, might be Ceres Beverages, and the potential buyers might include Tiger Brands or AVI, with the latter more likely given its negligible exposure in cold beverages. We of the Tatler, of course, decry such prying and reckless speculation.
Shoprite customers will think Christmas has come early thanks to its new free airtime deals. All shoppers have to do is buy the specially marked products, look out for the recharge number at the bottom of their till slip and they will get anywhere from 50c to R2 worth of airtime – absolutely free! – to chat with, or SMS with or MMS with or Mxit.... well, you get the idea.
Tatler Reporter 13/10/10
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