Tag: Woolworths

Woolworths launches online shopping in Mauritius

Source: Supermarket & Retailer

South African retailer Woolworths has announced the expansion of its online shopping offering to Mauritius. Woolworths shoppers in Mauritius will now have the option to shop fashion, beauty and homeware products directly off the retailer’s shelves and have it delivered to their homes. The retailer currently has six fashion, beauty and homeware only stores in the country.

The new online offering will be supported from the Bagatelle store, which offers the widest assortment of its fashion, beauty and homeware range.

Woolworths’ divisional executive for Rest of Africa, Yobe Mvula, said: “The launch of this online offering in Mauritius comes as we celebrate our 10-year anniversary of trading in Mauritius and is a first for us outside of our firmly established digital presence in South Africa.

“We have used our learning and experience from our existing market leading online operations to create an innovative e-commerce platform that is industry-leading and scalable, and will ensure that shoppers can still enjoy the same quality in-store shopping experience online.”

The pilot of the service covers all areas in Mauritius (excluding Reunion and Rodrigues islands for now), with delivery within 48 hours and the option for consumers to collect in-store.

When shopping online, customers are able to create a wish list of items they love, do product comparisons, check the availability of the item and see related products.

WRewards members can also enjoy the benefits offered under the loyalty programme on the platform.

Woolworths has included a free gift wrap service for those who prefer to have the gift delivered to a specified address on their behalf.

Delivery is free for the month of September during the initial launch. Thereafter, free delivery will apply to all purchases of R2 500 or more.

Woolies opens standalone liquor stores

Source: IOL 

Grocery retailer Woolworths has launched its first standalone liquor store in Bryanston, Johannesburg.

The retailer’s move will see it competing with several other retailers that have standalone liquor stores – including Spar’s TOPS brand and Pick n Pay Liquor.

The liquor outlet, called WCellar is next to the Woolworths food market in the Nicolway branch.

In a statement, the retailer said the liquor store offers wines, beers, craft beers, ciders, and spirits and opened yesterday, May 27.

According to the company, it aims to open another WCellar store in the Gauteng region, to roll out to a national footprint in the future.

Woolworths senior wine buyer Rebecca Constable said: “At Woolworths, we are constantly looking for ways to innovate and improve on our offering of quality products, so we’re excited about the launch of the WCellar brand extension”.

Constable added that the selection of drinks was carefully curated by the retailer’s team of experts.

“We’re confident that our customers won’t need, or want, to go anywhere else for their complete shop,” she said.

Woolies to launch same-day delivery service

By Lucinda Dordley for Cape Town Etc

Lovers of Woolies’ quality and service will be delighted to hear that the retailer has decided to launch its own same-day delivery service. It made this announcement via social media on Monday, 23 November 2020.

Called “Woolies Dash”, the retailer promises the service will deliver groceries within the hour. It did not, however, provide details on when the service will launch or which areas it will service.

Recently, competitors Pick n Pay and Checkers also launched similar delivery services.

Pick n Pay partnered with online grocery service Bottles to bring customers what they need. However, as Bottles was not permitted to sell alcohol during the strict lockdown earlier this year, the app had to be re-purposed for on-demand groceries instead of liquor.

Checkers has its Sixty60 app, which was launched in 2019. The service allows customers to accept a delivery within 60 minutes, or alternatively at a time that best suits them. Users can pay using a credit or chip-enabled debit card and shoppers can track their order throughout delivery with real-time GPS tracking.


Source: Engineering News

With the extension of lockdown and uncertainty about freedom of movement post 1 May, app-based on-demand delivery service QUENCH has adapted and amended their business strategy to now include same-day delivery of groceries from Woolworths to customers in major centres across South Africa.

Co-founder and Managing Director, Liam McCreedy, says QUENCH re-engineered their App from an alcohol to a grocery delivery service and have seen a significant spike in downloads and new active users since the launch of the new service.

They have seen a 350% increase in sales with 1 200 downloads in just three days.

“Our service is simple, seamless and very convenient. Whilst the country is under lockdown to curb the spread of the coronavirus, consumers are apprehensive to leave their homes and our contactless service provides them the peace of mind to order from the comfort of their couch! They can expect the same in-store prices and same-day delivery.”

McCreedy says the QUENCH app-based delivery service supports and alleviates the pressure on Woolworth’s online delivery service which has been inundated with orders.

QUENCH staff have been trained on how to deliver packages without any close contact and are equipped with masks and gloves.

Although the service is currently only available across Johannesburg, Pretoria, Cape Town, the Cape Winelands (Stellenbosch, Somerset West & Paarl) and George, the QUENCH team will be expanding their offering as demand increases.

The App is super easy to navigate and can be downloaded from the Google Play and Apple App stores. Deliveries are charged at a fixed rate of R60 per delivery and products are charged at the same prices as the in-store Woolworths pricing.

QUENCH will reactivate alcohol sales after the ban has been lifted.

Is Woolworths ‘in need of a shake-up’?

Analysts are divided on whether Woolworths CEO Ian Moir should fall on his sword after the retailer was forced to impair the value of its Australian department store chain, David Jones, by nearly R7bn.

Moir, an expert in fashion retail, has been at the helm since 2010. But David Jones has been weak and outperformed by the food division in SA and Australia. One thing all analysts agree on is that top management is in dire need of a shake-up.

Although Woolworths attributed the impairment to “the cyclical downturn and structural changes” affecting Australia’s retail sector, some analysts are adamant that overpaying for a struggling asset in a foreign territory was a bad move and top management should be held accountable.

They argue that at the core of the impairment, which equates to about a third of the R23.3bn paid in 2014, was poor foresight by management.

Portfolio manager at Gryphon Asset managers Casparus Treurnicht said that it was about time that top-level management was reorganised so individuals could be held more accountable. He reminisced about how in 2014 Woolworths assured shareholders that “initiatives are expected to deliver incremental ebit [earnings before interest and tax] of at least R1.4bn per annum within five years”.

However, the acquisition remained a noose around Woolworths’s neck, pointing to a poor performance by management.

“Wow! Management really did well for themselves!

“Not only did they overpay for DJ [David Jones], they simply got the cycle wrong and never delivered on promises.

“They must be held accountable,” said Treurnicht,

Peter Takaendesa, portfolio manager at Mergence Investment Managers, said that Moir had come out to take some responsibility for the poor execution at David Jones.

“Ian is an experienced retail executive and has executed very well in the past.”

He said other retail companies such as Mr Price had also experienced patches of weaker execution recently but had
managed to resolve those issues. “We therefore believe investors are likely to give him a chance to resolve those execution issues but failure to demonstrate progress over the next 12 months could cost him his job,” Takaendesa said.

Vele Asset Managers equity analyst Matthew Zunckel welcomed the impairment, saying it was overdue as it had been clear for a while that the assumptions used in calculating the goodwill attributable to David Jones were overly optimistic.

He said that while the write-off would distort a number of metrics, it would allow David Jones to strategically start on a “clean” slate with a more reasonable valuation of David Jones on Woolworths’s books and better prospects of earning an adequate return on capital.

But he maintained that management should take accountability for the “disastrous move”, as the acquisition resulted in a huge amount of value destruction for shareholders.

Woolworths warned that its headline earnings per share for the 26 weeks to December 24 were expected to drop between 12.5% and 17.5%.

On Thursday morning, the share price dropped 11.7% but recovered to close 2.33% lower on the day at R64.14. Those who invested in Woolies at the start of the year have lost 1.79%.

The underlying issue in Australia is that turnaround plans are not bearing fruit in the department store industry.

Zunckel said that department store managements were having to fight an established structural story of consumer preference for shopping online or at speciality retail stores, and so far that structural story had remained entrenched. Meanwhile, there is some wariness about close competitor TFG’s interest in expanding even further into the impregnable Australian market, after it bought RAG for R3bn in 2017.

“When will people realise that 70%-90% of acquisitions fail?” Treurnicht said, adding
that value could only be created organically. “That’s how Shoprite and Clicks’s share prices outperformed,” he said.

But Takaendesa argued that TFG’s international expansion appeared to be going well so far, which might mean that it was selecting better assets to acquire or executing better or both.

“They are currently an outlier in that regard as most South African retailers are struggling when it comes to expanding into highly competitive developed markets,” he said.

“We will be closely monitoring cash generation and the sustainability of their better performance to avoid Steinhoff kind of problems.”

Source: Supermarket & Retailer 

South Africa’s recession means households had less and less to spend, but the number one supermarket group in the country, Shoprite, is adopting an unlikely strategy: targeting upmarket shoppers.

Lower-income families who formed Shoprite’s core customer base were cutting back on spending, but the wealthy remained undented by the economic downturn.

In a bid to retain its leading industry position, the discount retailer’s new boss was driving business hard into the higher-margin niche dominated by rival Woolworths.

The stage was set for a turf war to win the hearts, minds and wallets of South Africa’s richest two million households — and ultimately, pre-eminence in the supermarket sector.

Shoprite CEO Pieter Engelbrecht told Reuters that growth lied in affluent areas and customers.

“A lot of those (wealthier) customers, two million of them, actually frequent our stores already, but not exclusively,” he said in an interview.

“Our job is to get a better share of their wallets when they are in our stores and then impress them so that they come back again.”

Shoprite was doubling its offering of the kind of high-end convenience foods that Woolworths built its reputation on – from gourmet lamb shanks and oxtail stew to teriyaki-and-ginger basted pork ribs.

Its range would reach around 500 products by the end of this year, Engelbrecht said.

These products typically cost about R200 for a meal for four — 10 times the minimum wage of R20 an hour as set by new labour laws making their way through Parliament.

As part of the drive to expand its range, Engelbrecht said Shoprite had upgraded its food technology and development facilities, and gone on a hiring spree for food developers and technologists.

The company planned to open 23 new outlets of its higher-end Checkers chain of stores, mostly in wealthy suburbs such as Waterfall City north of Johannesburg.

New Checkers stores and established ones that had been refurbished resembled Woolworths outlets with sparse lighting and wood-panelled sections boasting extensive wine and gourmet coffee selections, as well as counters selling quality selections of cheese and meat.

‘I love Woolies’

But how will Woolworths defend a market that delivered handsome profits for the company?

When asked about Shoprite’s push into upmarket convenience food, Woolworths said that it had an “incredibly valuable emotional connection” with its customers.

“Retail is a dynamic environment and the competition in the grocery and food market category means that we will always keep a watching brief on our competitors’ activities,” it added.

“We conduct weekly basket checks against the prices of competitors to ensure that our prices are comparable.”

It was a tall order for Shoprite to break Woolworths’ stranglehold.

“They (Woolworths) have been good at introducing new products and other innovations in line with consumer trends and feedback,” said Old Mutual Invest food retail analyst Kaya Nodada.

If Shoprite was to prevail, it would have to win over shoppers like JF Fourie.

“I love Woolies. The microwave meals are a bit overpriced, but they are tasty,” the 28-year-old who works in marketing said in the Woolworths branch in eastern Pretoria as she added shimeji mushrooms to the baby brinjals in her basket.

Fourie – a big fan of Gordon Ramsay – said she would need some convincing about the quality of Shoprite’s products, but would give it a go because Checkers adverts feature the British celebrity chef.

“I like the chef and he hates airplane food,” she adds.

“He’s fussy and I am too.”



South African consumers have hit hard times over the past few years as a creeping GDP growth, high unemployment and many political shocks continued to weigh on the economy.

In June, GDP data from Stats SA showed that South Africa has officially entered into a recession, with economists predicting tough times ahead for consumers, as more ratings downgrades are in the pipeline, which will ultimately put further pressure on the pocket.

One of the key components of South Africa’s slide into recession was a cut in consumer spending, in everything from recreation, clothing and transport, to even basic needs categories like food.

And South Africa’s biggest food retailers are feeling the pinch.

In April, Pick n Pay missed expectations for its full year earnings citing strained consumer spending as shoppers sought out cheaper options – which appeared to drive them to Shoprite’s doors, who reported a 14% growth in turnover in its latest financial year.

Woolworths, which has consistently positioned itself as a ‘premium’ food store, has seemed to weather the storm, with its latest results for FY2016 showing a 24% growth in profit from its food segment – which makes up 37% of the group’s total turnover.

A weakening economy and drought conditions hit South African food prices hard in 2016, with food inflation hitting close to 12% throughout the year. With a record yield from crops expected in 2017, some relief is on the cards – but the recession and other expected economic woes are likely to keep the pressure on consumers.

In the latest assessment of prices across South African retailers, we found that there has not been much a shift among South Africa’s food retailers.

When shopping for the BusinessTech basket of goods, Woolworths still checks out at the highest price – though it is apparent that, with the exception of Shoprite, competitors have struggled to keep prices low.

The BusinessTech Basket of Goods

For our basket, we look at some essential and non-essential food products. The basket contains 12 items, with store-brands priced for each item where available. The table below shows the pricing:

Prices were sourced in-store from stores around Centurion and cross-checked online, where applicable.Promotional prices, where marked, were not taken into account. Woolworths self-raising flour prices were determined on a per kg basis. In-store prices are subject to change depending on individual regions and promotions.

Prices have increased significantly in some cases, compared to the mid-2015 review. This is most notable in sugar and maize, which were impacted by drought conditions in the country during the interim period.

The most striking difference between the 2015 and 2017 reviews is that Pick n Pay, which was ranked as the cheapest basket in 2015, is now extremely close to being the second-most expensive, a few rands under Spar.

Checkers, which has positioned itself as the more affordable option, has lived up to that reputation, with many of its prices actually decreasing between 2015 and 2017.

Source: www.supermarket.co.za

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