Shoprite South Africa | Food Retail

Affordable, Accessible, Innovative

PROJECT DIRECTED BY

WRITTEN BY

Malvern Kandemwa

Romana Moares

Shoprite SA As Africa’s largest retailer, the Shoprite Group is one of the continent’s most fast-paced, innovative and technologically advanced retail organisations, with more than 140,000 employees. Its core business is in food retailing, complemented by furniture, pharmaceuticals, hospitality, ticketing, digital commerce, and financial and cellular services.

Through its wide range of customer-facing brands, value-added services and B2B logistics services, the Group operates across various industries to deliver a comprehensive product and services offering.

“

The Shoprite brand has always strived to provide low-cost goods and services without compromising on quality

“

Affordable, Accessible, Innovative With a number of subsidiaries and brands, Shoprite is the largest retailer in South Africa across a range of segments. Affordable and accessible, the company is proud to provide basic goods and services to the mass middleincome market.

2

Issue 104 · Business Enquirer Magazine

Shoprite’s story starts with the purchase of an eight-store grocery chain in 1979. The brand first developed in South Africa and from 1990 expanded further afield with the opening of its first non-RSA supermarket in Windhoek, Namibia. Since then, this award-winning retail brand has grown to include hundreds of stores across the African continent.

The Shoprite brand has always strived to provide low-cost goods and services without compromising on quality. Shoprite credits much of its success to its centralised distribution system and the fact that it controls its own logistics. Investment has been an integral part of the brand’s strategy, and has continued unhindered by the global pandemic.

A recent example is Shoprite’s newly opened distribution park outside Cape Town, dubbed Cilmor, covering a massive 123,000m². The park is claimed to be one of the most technologically advanced facilities of its type on the continent, bringing together the operations of five distribution centres in Cape Town.

Business Enquirer Magazine · Issue 104

3

Shoprite SA Inspiring leadership Pieter Engelbrecht, Shoprite’s chief executive, recently presented the Group’s annual results at the Cilmor facility. Despite lockdown restrictions, Shoprite delivered an exceptional financial performance for the last financial year (ending in July 2021), as evidenced by 8.1% growth in sales, a 55-basis point improvement in gross margin to 24.5% and expense growth of 6.7% as well as increased market share.

Retail Feature Engelbrecht and his team are focused on implementing the Group’s growth strategy to maintain its lead in discount retail. His key priority is serving customers through a determined focus on lowering prices through an optimised supply chain and world-class operating efficiencies.

The Shoprite Group currently operates 2,252 stores within South Africa, and 437 outlets in 14 other African countries. Shoprite’s core South African supermarket operation represents 72% of total sales and 79% of trading profit. In the rest of the continent, Angola and Nigeria continue to be the top performers.

Much of this excellent result may be credited to the leadership of Pieter Engelbrecht, who has been the driving force behind the strategic thinking and decisiveness that characterises the Shoprite Group’s actions and has led Shoprite to become not only Africa’s largest food retailer and low price leader, but also South Africa’s largest private-sector employer.

His leadership has been characterised by the Group’s mission to be Africa’s most affordable, accessible and innovative retailer, driven by a relentless focus on innovation which has led to the repositioning of Checkers in the fresh and convenience space, the development of the fast-growing Shoprite and Checkers Xtra Savings Rewards programmes, Sixty60 food delivery service and virtual vouchers, among many other innovations.

He has successfully steered the Group through the coronavirus pandemic, ensuring job security for the Group’s workforce and product availability and a safe shopping environment for the Group’s 24 million customers while increasing sales, profitability and market share.

4

Issue 104 · Business Enquirer Magazine

Business Enquirer Magazine · Issue 104

5

Complete intralogistics from a single source.

This is how we move industries.

Retail Feature With environmental protection defined as one of its priorities, Jungheinrich is among the Top 1% most sustainable companies worldwide. For its above-average performance in environmental protection, human rights and sustainable procurement, the company has recently been awarded the highest – platinum – sustainability certificate by the EcoVadis rating agency.

Jungheinrich Moving the World Founded in Hamburg in 1953, Jungheinrich has grown into one of the world’s leading intralogistics companies, with its products marketed by 40 direct distribution companies around the world.

The Group strategy is focused on sustainable, profitable growth in order to enhance the value of the company. Its portfolio includes forklift trucks for all sectors and applications, which are supplied as new, used or for rent, complete with a range of services such as the planning, development and implementation of complex storage systems and automation solutions.

Jungheinrich represents a reliable one-stop shop for everything from planning and analysis to digital controls; from racking and warehouse equipment to sophisticated energy options and a global service network.

Sustainable growth The company strives to optimise its customers’ process flows, improving warehouse productivity and lowering operating costs, while reducing environmental impact.

We develop, produce and sell new trucks and are also involved in the logistics system and mail-order business. In addition, we rent both new and used forklift trucks, recondition and sell used trucks and offer maintenance, repair and spare parts services. Add to this a comprehensive range of financial services, and you can see that we represent a one-stop shop covering the entire product life cycle.

In its recently presented Strategy 2025+, Jungheinrich has embedded the issue of sustainability even more firmly in its operation and has set itself the ambitious goal of becoming CO2 neutral in the coming years. To this end, the company has introduced systematic sustainability management within the company and along the entire supply chain.

Dr Lars Brzoska, Chairman of the Board of Management of Jungheinrich AG says: “Jungheinrich creates sustainable value. For us as a family-owned company, this means in concrete terms that we combine social and ecological responsibility with profitable growth.

This self-image drives us to shape intralogistics and the warehouse of the future. The platinum EcoVadis certificate is a great confirmation for us and, of course, an obligation at the same time to continue on our path in the future.”

Pioneer of electromobility As the first manufacturer to launch industrial trucks with lithium-ion batteries, the company has been working intensively on the development of sustainable lithium-ion vehicles for almost 10 years, in order to secure maximum efficiency, safety and comfort at minimum consumption and cost.

Thanks to its own research, development and production, the company can now offer a li-ion vehicle concept that is unique on the market – a connected overall system in which battery, charger and vehicle are optimally synchronized, supplemented at all times by competent customer service. The result: high power and performance, fast charging times, smart energy recovery, timeand resource-saving zero maintenance and three-times longer service life. ”In the future, we will continue to practice our family values in the conflict area that exists between market demands and corporate responsibility. As a family company with a solid foundation of values, we will play a big part in shaping the future of intralogistics. Our aim is to establish our exacting standards as industry-wide benchmarks. After all, everyone shares the same corporate responsibility towards society and the environment – and we intend to lead the way,” says Dr Brzoska.

Find out more at www.jungheinrich.co.za Business Enquirer Magazine · Issue 104

7

Shoprite SA

Retail Feature

People’s business Speaking about the Group’s performance, Pieter Engelbrecht highlighted the importance of the Group’s key asset – its people. “Our business success depends on the wellbeing of our people,” he said. “We work hard at nurturing our relationship with them while we look after the sustainability of the Group. We aim to be an employer of choice and pride ourselves on being a job-creating company with a strong hire-to-retire model.”

“We acknowledge that we need to build our talent and succession pool with experts to stay ahead of the game. In recent years we have employed several senior executives who contribute to strengthening our position as the largest retailer on the continent.

They, too, are strengthening their own teams to be future-fit and demographically relevant.”

“To remain globally competitive we have to retain and grow our talent. Our HR strategy addresses the need for an engaged and empowered workforce, providing ongoing learning opportunities and promoting diversity, where every position in our business will be evaluated to make sure we have the right people in the right places to deliver on our purpose.”

“

Our business success depends on the wellbeing of our people.

We work hard at nurturing our relationship with them.

“

The Shoprite Group was announced as the 2021 Graduate Employer of Choice at the 2021 GradStar Student Choice Awards. This accolade is based on the results of nearly 3,000 students who listed the Group as one of the top five companies they’d like to work for based on their knowledge of the employment landscape. Earlier last year the Group was also awarded the 2021 Employer of Choice in the retail category of the South African Graduate Employers Association (SAGEA) Employer Awards.

Pieter Engelbrecht acknowledged that finding enough skilled people to employ across the Group’s diverse operations is a continuing challenge. “Retail requires a specific level of experience on all levels. We mostly recruit from outside at a junior level, addressing unemployment and youth development; and then train, develop and promote from within as individuals gain the knowledge and experience required in our environment.”

8

Issue 104 · Business Enquirer Magazine

Business Enquirer Magazine · Issue 104

9

Shoprite §

Mix Telematics Mobile Information Exchange Operating at optimum efficiency is critical for supermarket retailers where the safety of the drivers and the efficient delivery of the thousands of products being transported every day is of paramount importance. Numerous factors can make a standard journey accumulate unnecessary costs, be less efficient and exposed to risks. When managing a fleet of vehicles, fleet managers and operators within the FMCG industry specifically, need to be able to adapt to the demanding day-to-day challenges that fleet operations can face.

As the largest supermarket retailer on the African continent, the Shoprite Checkers Group has been a long-standing customer of MiX Telematics. Since 2011 they have entrusted MiX Telematics to supply a full suite of fleet-management services to their fleet of more than 1000 trackable assets.

Specific solutions being provided to Shoprite include a combination of MiX Fleet Manager Premium software and hardware, MiX Talk (MiX’s hands-free, in-vehicle communications device aimed at reducing the risk associated with making and receiving calls whilst driving), MiX Track and React, a 24/7 service that assists with real-time driving event management while mitigating hijacking and theft risks, MiX Fleet Manager Essential installed into their pool fleet to assist with managing fines and vehicle misuse and the MiX Shoprite BI Tool.

The MiX Fleet Manager Premium solution offers Shoprite unlimited access to information about their vehicles and drivers. The solution comprises a sophisticated on-board computer that collects and transmits valuable vehicle and driver data. This data is hosted in one of several top-tier data centres, with information accessible online or via the mobile app.

The MiX Shoprite BI tool is an online, custom-built platform that allows Shoprite to use Big Data to answer pressing fleet questions and make informed operational decisions by presenting relevant and accurate fleet data in a simplified way. With this BI platform, Shoprite has access

to various dashboards, trend charts and graphs that analyses the data for fuel management, utilisation, driver scores, temperature violations, on-time arrivals and departures at stores, turnaround times, and status overview and fleet health status check dashboards just to name a few.

“The online dashboards and telematics data provided by MiX is vitally important for the daily operational decisions that the Shoprite Checkers Group has to make,” says Gert Pretorius, Managing Director, MiX Telematics Africa. “The active fleet data is used to detect trends, monitor vehicle utilisation and driver behaviour, as well as fuel consumption. Considerations that have become even more important during the pandemic and the current economic climate.”

The rich telematics data is utilised to improve efficiencies, better asset security, lowered risk and compliance with industry-related regulations and procedures.

In addition to the premium fleet management solutions, MiX also supplies a cold chain solution that is integrated with their telematics system. This improves the management of cold-chain adherence parameters and minimises out-of-tolerance temperatures during critical times. A full temperature history of a shipment can also be made available to assist in calculating the loss of shelf life or the likelihood of spoilage, identify the time and the location of a shipment when out-of-tolerance temperatures are encountered, which allows for immediate corrective action.

The journey execution management software, MiX Journey Management, assists with the correct allocation of drivers, trucks, and trailers to specific routes. This results in the monitoring of temperature violations, on time arrivals and departures at stores and turnaround times, just to name a few.

MiX Telematics solutions enable Shoprite to not only benefit from managing their vehicle and drivers, but also to have better fuel efficiencies, improved safety, increased utilisation, and enhanced customer service.

MiX Telematics, a leading global SaaS provider of connected fleet management solutions, is continuously adding value to the operations the Shoprite Checkers Group and is testament to how successful its solutions are at meeting the specific requirements of the FMCG industry.

Find out more www.mixtelematics.com.

Business Enquirer Magazine · Issue 104

11

Retail Feature

Shoprite SA

Set to seize opportunities The sophisticated nature of Shoprite’s supply chain management is a major contributing factor to its success. The Group has invested heavily in its systems and infrastructure, aligning with international best practice.

“The physical aspects of our supply chain, from supplier to customer, are dependent on a symbiotic relationship with the technology back-end that ultimately connects the product source to the customer. Our bricks-and-mortar footprint remains key to our ability to drive growth and expansion into new channels, as we use our stores as initial contact points with customers.”

Long-term sustainability is becoming more important as countries and companies across the world are battling with increased pressure on resources. Shoprite is doing its best to reduce its environmental impact and influence change, addressing the challenges and developing and supporting community projects.

“This year we engaged with suppliers to understand what they monitor within their own supply chain and how they are reducing their impact. Understanding the issues our suppliers monitor and manage allows us to better understand the supporting role we could play as well as the risks and problems we may encounter in our own supply chain. Responsible sourcing is an imperative, not only from environmental and social perspectives, but it also plays an important role in providing the best-quality product to our customers.”

Over the past 40 years, Shoprite has proved its resilience and value by creating brand trust, recognition and goodwill in the countries where it operates. With more than 2,913 outlets across Africa and over 142,000 employees, the company is set to seize new opportunities for growth in the years to come. www.shoprite.co.za

12

Issue 104 · Business Enquirer Magazine

Issue 104 · Business Enquirer Magazine

13

Shoprite SA + www.shoprite.co.za

info@busenq.com www.busenq.com