Retail news. Semester 1 of 2014 table of contents

Retail super-brand winner. bizcommunity.com [8 March 2011]. [Staff reporter].

Zimbabwe's retail super-brand winner 2010, supermarket franchise Spar, and TM Supermarkets, the biggest supermarket by outlets, trailed rival OK Supermarkets as the most preferred outlet, with emerging Chinese-owned Afro-Foods Supermarkets taking the fourth spot.

Zeenat Moorad] SA's second-largest grocer, Pick n Pay, said on Tuesday (25 January 2011) that it had not received any notification from the Zimbabwean government of its intention to halt its bid to acquire 24% of Zimbabwean retailer TM Supermarkets. 26 Jan 2011 09:10


South Africa's Massmart, a sitting duck for a US$2 billion takeover bid by US retailer Wal-Mart Store Inc., has sold its Zimbabwe unit to retail group, OK Zimbabwe. The deal ends months of speculation over Massmart's planned disposal of Makro Zimbabwe and the identity of the buyer. 10 Dec 2010 11:22


Zimbabwe's Meikles group has agreed to allow Pick n Pay to rebrand TM Supermarkets after a deal in which the South African retailer will shore up its shareholding in the supermarket chain to 49%. 2 Dec 2010 11:28

OK dominates as Zimbabwe's preferred retailer

By: Staff reporter

Zimbabwe's retail super-brand winner 2010, supermarket franchise Spar, and TM Supermarkets, the biggest supermarket by outlets, trailed rival OK Supermarkets as the most preferred outlet, with emerging Chinese-owned Afro-Foods Supermarkets taking the fourth spot.

This was revealed in the latest Zimbabwe All Media Products Survey (ZAMPS) for the fourth quarter of 2010 commissioned by the Zimbabwe Advertising Research Foundation (ZARF) to provide both media and product information to allow marketers to more effectively target and reach consumers.

Significant interest to various parties

The survey has however been of significant interest to political organisations, diplomats, the corporate sector and other stakeholders because of the diversity of information available from the survey.

OK Supermarkets, a unit of listed OK Zimbabwe currently splurging on massive refurbishment and stock hoarding after a US$20 million equity loans and rights issue that brought in South Africa-based Investec Africa Frontier Private Equity Fund as a new shareholder early last year, emerged top as the "most preferred outlet" among urbanites, followed by Spar (24%), TM Supermarkets (15%) and Afro-Foods (8%).

OK also dominated as the "most often outlet" with a 34% score, followed by TM Supermarkets and Spar Supermarkets with 18% each, the survey showed.

OK also led as the outlet where food and groceries are bought with a score of 71% followed by TM at 59% and Spar at 56%.

"(The) most preferred outlets in this quarter were OK, SPAR and TM," noted the survey authors, Research Bureau International.

TM has 51 supermarket outlets, against 49 outlets owned by OK Zimbabwe. However, only 35 outlets are under the OK brand, with five under the Bon Marche brand, three operating as OK Express stores and six as Pax Cash & Carry stores.

Spar, aggressively expanding

Spar, a South African franchise controlled by the Innscor Africa group in Zimbabwe, has been aggressively expanding since 2004 and now has over 50 outlets in Zimbabwe's northern region alone. The ability of Spar to take advantage of the buying power of its counterpart in South Africa has meant that it has been able to offer its members a wide range of imported products at reasonably affordable prices. Spar clinched the Marketers Association of Zimbabwe-run Superbrand 2010 retail sector award in December.

Afro-Foods, which emerged out of a decade-old economic crisis that ended in 2009, has also been growing significantly and late last year took over 12 town and country outlets owned by Zimbabwe Stock Exchange-listed CFI Holdings.

But the survey showed that the majority of Zimbabwe's urbanites preferred buying meat from butcheries (77%), with 8% preferring Spar, 5% preferring OK and 2% preferring TM Supermarkets.

Open markets were the preferred outlets for the purchase of fruits and vegetables (63%), with informal traders or hawkers commanding an 11% share of this market and fruit and vegetable shops in high density suburbs getting a 6% slice of the market. Spar led its rivals in this market with a 6% share with OK and TM getting 2% of the market apiece.

[21 Feb 2011 09:48]

Companiesandmarkets.com [8 March 2011]

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Zimbabwe Food and Drink Report 2011

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Zimbabwe Food and Drink Report 2011 - Following years of dismal news from Zimbabwe's food and drink sector, things appeared to be looking up in 2010. Over the past decade the Zimbabwean economy shed more than half its value, as ten successive years of heavy contraction between 1999 and 2008 decimated its fast-moving consumer goods (FMCG) industry and shattered its investment appeal. Coming off a strong 2009, Zimbabwe's food and drink industry had finally started to turn the corner. In 2010 the degree of stability provided by the functional unity government and the ongoing consumer spending kick provided by the overdue dropping of the Zimbabwean dollar in 2009 continued to play out. Demand for both basic and nonessential food and drink products continued to increase, which allowed producers to continue raising production capacity. With GDP growth expected to average an explosive 7.2% between 2010 and 2015 (what we see as being the first phase of the recovery), the food and drink industry is expected to leverage off the sharp economic gains with significant growth in consumption anticipated.

Key Company Trends

Signs of Recovery In Drinks Sector – Throughout 2010 there were many signs that the Zimbabwean drinks sector could be recovering. In a real show of confidence in the re-emerging Zimbabwean consumer market, in May 2010 SABMiller's beer and soft drinks partner Delta Corporation announced its plans to invest US$112mn in the country over the next two years, with capital expenditure going mostly towards capacity strengthening. With so much slack left in the economy – Delta is believed to be operating at just 65% of full capacity – there is plenty of scope for growth.

South African Retailers Make Cautious Moves – South Africa's leading retailers have been looking at investment possibilities in the Zimbabwean market as they look to cut down reliance on their domestic market and establish themselves in the region in order to capitalize on strong expected growth. However, at the end of 2010 South Africa's leading retailers were sending out mixed signals about Zimbabwe.

Shoprite was taking stock while Pick 'n' Pay, eager to strengthen its exposure to wider Africa, is due to bump up its stake in the domestic retailer TM to 49% from 25%. Meanwhile, Massmart has thrown its hat out of the ring, at least for now, after selling its Zimbabwean business to OK Zimbabwe.

Fast Food Taking Off? – In a further sign that things may be improving for both the food sector and the greater business environment, in September 2010 multinational fast-food chain McDonald's announced that it is planning to venture into the Zimbabwean market. The company's earlier attempt to enter the market in 1999 failed as a result of growing political and economic instability. Meanwhile, in September 2010 Innscor, a food services and retail firm, announced that it expects its annual sales to grow by about 25% to roughly US$500mn in the year to June 2011. Particularly strong in food services, Innscor operates a wide array of fast-food stores in Zimbabwe and the wider Southern and East Africa regions, and is the Zimbabwean franchisee for South Africa-based Nandos and Steers.

Key Risks to Outlook

Risks to Economy Manifold – Should the election process or the political climate deteriorate significantly, economic activity would be negatively impacted despite companies' current plans to charge ahead with investments. Additionally, if the clarifications over the indigenisation drive result in more punitive (to foreigners) legislation than we currently anticipate, this would have ramifications across the economy and in the mining sector in particular.

Exchange Rate Fluctuations – The country's dependence on imports also makes price growth vulnerable to exchange rate movements. Although officially operating under a multi-currency regime, the majority of transactions are conducted in US dollars, while most imports come from South Africa. This being the case, any significant rand appreciation versus the US dollar would