Shoprite lures shoppers seeking inflation relief at more low-end outlets
South African shoppers with limited spending money are turning to low-cost supermarket chains, such as Shoprite, for cheaper food, and eschewing new clothes to counter accelerating inflation. On Tuesday, Africa’s biggest food retailer reported 7.4% half-year sales growth at South African stores that have been open for more than a year, equal to how much the company raised prices in the period. This outperformed like-for-like food growth at higher-end department store chain Woolworths as shoppers shunned more expensive foodstuff in favour of cheaper options. For those selling fridges, furniture and clothes, it is an even bleaker picture. "It’s a confidence issue," Damon Buss, an equity analyst at Electus Fund Managers in Cape Town, said. "Consumers are not spending as easily, they are holding back." South African shoppers have been hurt by an inflation rate that climbed to a 10-month high of 6.8% in December, led by surging food costs following the worst drought since at least 1904. ...
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