{"id":825880,"date":"2025-05-28T11:30:00","date_gmt":"2025-05-28T09:30:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=825880"},"modified":"2025-05-28T11:38:13","modified_gmt":"2025-05-28T09:38:13","slug":"whitey-basson-outsmarted-walmart-and-stopped-them-from-buying-pick-n-pay","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/825880\/whitey-basson-outsmarted-walmart-and-stopped-them-from-buying-pick-n-pay\/","title":{"rendered":"Whitey Basson outsmarted Walmart and stopped them from buying Pick n Pay"},"content":{"rendered":"\n

Around fifteen years ago, Walmart wanted to enter the South African market, and former Shoprite CEO Whitey Basson outsmarted them to ensure they did not threaten his company.<\/p>\n\n\n\n

Whitey Basson is well-known a South African retail giant who built Shoprite from an R1 million business to the biggest retailer in Africa, worth over R160 billion.<\/p>\n\n\n\n

However, it was not only his retail expertise which ranked him among the top executives globally. He was also a master business tactician.<\/p>\n\n\n\n

This skill was illustrated in how he outmanoeuvred the world\u2019s largest retail corporation, Walmart, when it wanted to enter South Africa.<\/p>\n\n\n\n

In the book, Whitey, by Neil Joubert, Basson lifted the veil on what happened behind the scenes when the American giant started to approach local retailers.<\/p>\n\n\n\n

Basson said that when Walmart came to South Africa to explore opportunities, they approached him and asked whether Shoprite would sell to them.<\/p>\n\n\n\n

He told them that Christo Wiese was the controlling shareholder and that they would have to ask him about buying Shoprite.<\/p>\n\n\n\n

\u201cI don\u2019t think that is likely to happen, and I don\u2019t think we would like to be a subsidiary of an overseas company either,\u201d Basson told Walmart.<\/p>\n\n\n\n

He was right. Shoprite\u2019s billionaire chairman, Christo Wiese, told Walmart that they could not buy Shoprite.<\/p>\n\n\n\n

However, Basson and Shoprite faced a significant threat. If Walmart were to buy Pick n Pay, it could make their life very difficult.<\/p>\n\n\n\n

Pick n Pay did very well at the time. Under CEO Sean Summers\u2019 leadership in the 2000s, Pick n Pay became the grocery market leader in South Africa.<\/p>\n\n\n\n

Pick n Pay achieved an average annual revenue growth rate of 16% annually, which was higher than Shoprite\u2019s over the same period.<\/p>\n\n\n\n

\u201cI planned to get Walmart off our back and prevent them from buying Pick n Pay, because that was my biggest fear,\u201d he said.<\/p>\n\n\n\n

\u201cSo, I talked to the Walmart team for almost two hours to convince them that Makro was their best option.\u201d<\/p>\n\n\n\n

His plan worked exactly as planned. In 2011, Walmart bought the majority stake in Massmart, which owned Makro and Game, for R16.5 billion.<\/p>\n\n\n\n

\u201cThank heavens they didn\u2019t buy Pick n Pay. That would have been a major problem,\u201d Basson said in an interview with Joubert.<\/p>\n\n\n\n

Making sure that Walmart did not become a threat<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

The next step in Basson\u2019s plan was to ensure that Walmart would not make Makro and Game successful competitors to Shoprite and Checkers.<\/p>\n\n\n\n

Walmart is known for its aggressive pricing, which posed a significant threat to Shoprite and other local retailers.<\/p>\n\n\n\n

At the time, Massmart was listed on the Johannesburg Stock Exchange (JSE), which means the company\u2019s financial performance was closely watched.<\/p>\n\n\n\n

Basson explained that all he needed to do to ensure that Massmart could not aggressively cut prices after the Walmart acquisition was to ensure it remained listed.<\/p>\n\n\n\n

\u201cIf they had come in unlisted, they could simply have wiped us out with discount prices. It wouldn\u2019t even have made a dent in their books,\u201d he said.<\/p>\n\n\n\n

\u201cHowever, if you\u2019re listed, and your performance is constantly analysed in the press, it hamstrings you quite a bit.\u201d<\/p>\n\n\n\n

He said Walmart did many things with Massmart that were \u2018really stupid\u2019. \u201cGame was a total disaster. They literally destroyed a good business within two years,\u201d he said.<\/p>\n\n\n\n

\u201cI don\u2019t think their entry into the South African market was well thought through. I do think their hardware stores are excellent and will do well in South Africa,\u201d he said.<\/p>\n\n\n\n

Massmart struggled, and in August 2021, five years after Basson left the company, it sold a part of its stable to Shoprite for R1.36 billion.<\/p>\n\n\n\n

The deal comprised 56 Cambridge Food and Rhino Cash & Carry stores, which included 43 liquor outlets, as well as 12 Masscash Cash & Carry stores. They became Shoprite or Usave stores.<\/p>\n\n\n\n

Basson said he never thought Walmart would become the force in South Africa that it was in the United States.<\/p>\n\n\n\n

He explained that the South African market had its own challenges and was among the most competitive in the world.<\/p>\n\n\n\n

\u201cNever fight a small war with your entire defence force,\u201d Whitey said regarding Walmart\u2019s entry into the local market.<\/p>\n\n\n\n

In August 2022, Massmart\u2019s board and Walmart reached an agreement for Walmart to buy all the shares in Massmart, which owns Makro, Game, and Builders.<\/p>\n\n\n\n

Massmart delisted from the Johannesburg Stock Exchange on 22 November 2022, which marked the end of an era.<\/p>\n\n\n\n

This is a summary from the Neil Joubert\u2019s book, Whitey: The Rise and Rule of the Shoprite King. It is available here<\/a><\/strong>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Former Shoprite CEO Whitey Basson convinced the United States retail giant Walmart to buy Makro instead of Pick n Pay, thereby preventing his biggest fear from becoming true.<\/p>\n","protected":false},"author":10,"featured_media":812435,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[5223,11615,8961,10387,4067,19960,7520,2819,20403],"class_list":["post-825880","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-checkers","tag-game","tag-makro","tag-massmart","tag-pick-n-pay","tag-sean-summers","tag-shoprite","tag-walmart","tag-whitey-basson"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/825880","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=825880"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/825880\/revisions"}],"predecessor-version":[{"id":825881,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/825880\/revisions\/825881"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/812435"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=825880"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=825880"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=825880"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}