Big expansion plans for Shoprite – including a massive new campus in Joburg

 ·6 Sep 2022

Retail giant Shoprite says that it is planning for rapid expansion in South Africa, adding hundreds of new stores, and building a new campus in Johannesburg.

Presenting its annual results for the year to July 2022, the group reported a 6.8% jump in profit to R11 billion, with sales up 9.6% to R184.1 billion.

Despite being hit by the destruction caused by July 2021’s riots, the group said it managed to add a net number of 117 stores during the financial year.

Speaking in terms of its retail store-based operations, Shoprite is targeting a record 275 store openings in 2023, across the group. Within this, the Supermarkets RSA segment plans to open 220 stores, of which 95 stores will serve the mid-to-lower segment customers.

This expansion is outside of the stores the group is expecting to acquire as part of its proposed Cambridge Food, Massfresh and Masscash Cash and Carry acquisition, it said. The new stores also don’t include those that are scheduled to re-open due to social unrest closures.

“We’ve…advanced our proposed acquisition of Cambridge Food, Massfresh as well as Masscash Cash and Carry to the Competition Tribunal approval stage,” said Shoprite CEO, Pieter Engelbrecht.

“I sincerely hope this transaction can be finalised during the first half of the 2023 financial year to allow us the opportunity to integrate these businesses and their employees into our South African Shoprite supermarkets’ operations.”

On the supply chain front, 2023 will also mark the start of the first phase of a multi-year supply chain expansion which it said will add approximately 200,000 square metres of distribution capacity over the next three years.

As part of this, the group also plans to break ground on a new 85,000-square-metre Johannesburg campus during this first quarter period, with a go-live for this facility expected towards the end of its 2024 financial year.

“We have much to do in terms of executing our strategy to grow the business in the years ahead, this is just one of our initiatives, and we look forward to reporting on our progress on this and our other plans during 2023,” Engelbrecht said.

Currently, the group has 29 distribution centres across its operations, encompassing 673,843 square metres, and including its Cilmor Distribution Centre, in Brackenfell, Cape Town, where its head office is located.

During the 2022 financial year, Shoprite added 124 new stores in South Africa, while seven closed, giving a net addition of 117 stores.

Some stores remained closed due to the social unrest that took place in July 2021. At the end of the reporting period, the number of stores still closed due to extensive damage during the social unrest totalled 31 – including two Checkers Hypers. It is envisaged that nine of these will not re-open, the group said.

With the Checkers brand, the chain’s store upgrade strategy is continuing, with a further 43 stores refurbished this year. In terms of new stores, Checkers opened 10 new supermarkets during the period, three of which were in the new neighbourhood Checkers Foods format (average size 1,153 square metres).

In addition, 21 Petshop Science stand-alone premium pet stores and one Little Me stand-alone baby store were opened during the year.

Checkers, inclusive of Checkers Hyper, ended the period with 275 stores.

The group opened 42 liquor stores and 30 Usave stores in the year and added 19 under the Shoprite brand.


Read: Shoprite points to strong store growth and job creation in South Africa

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