A WEE DRAM
CHRIS GILMOUR: Not all markets friendly for Spar ‘wherever they are’
An obvious risk is how to achieve overall sales growth and expand the number of franchised stores
The year to the end of September was tough for Spar, as was the case for most local food retailers. Total group turnover rose by 5.3%, masking a mixed segmental and geographic performance. Spar Group is one of SA’s largest food retailers. However, it differs markedly from its two main competitors, Shoprite and Pick n Pay, insofar as it owns few stores and makes its money through wholesale distribution to Spar franchisees. Unlike the other two, it also has limited African exposure outside SA, preferring to seek incremental growth in Europe and, more recently, Asia. It services a network of 3,768 stores, with 2,138 in SA, 1,330 in Ireland and 300 in Switzerland. For the year under review, in the South African division, combined revenue from Spar and its TOPS liquor business grew by 4.9%. That is relatively poor in comparison with the growth of Shoprite (10.5%) and Pick n Pay (5.1%), and it’s safe to assume Spar has lost market share. To support this, it is worth comparing Spar’s local...
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