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South Africa’s biggest retailers: Shoprite vs Woolworths vs Spar vs Pick n Pay

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Professional services group Deloitte has published its annual Global Powers of Retail report for 2020, ranking the 250 biggest retail groups across the world – including four from South Africa.

The ranking is based on publicly available data for FY2018, covering fiscal years ended through June 2019. Deloitte analyses a company’s performance across geographies, sectors, and channels.

The 2020 report marks the return of multinational group, Steinhoff into the rankings, after the group was dropped from the report in 2019 following its accounting fraud scandal that emerged in 2017/18, and the group’s subsequent failure to produce full year results.

Despite making a net loss of over $1.4 billion in FY 2018, Steinhoff’s $15.14 billion in retail sales in the year make it largest retailing group in South Africa by some margin, with Shoprite following with $10.59 billion in retail revenue.

Overall, Steinhoff ranks 64th in the list, followed by Shoprite (100th), the Spar Group (132nd), Pick n Pay (162nd) and Woolworths (205th).

All South Africa’s retailers dropped down the rankings, reflecting the tight trading conditions they face in South Africa, with spending under pressure amid low consumer confidence, creeping economic growth, and rising prices.

“Steinhoff and Shoprite were the major revenue contributors in the Middle East/Africa region in FY2018. However, with revenue for Steinhoff falling by more than 25%, and despite 3.6% growth for Shoprite, companies in the region recorded a decline in revenue of 0.4%, as compared to 9.8% growth in FY2017,” Deloitte said.

“The fall in revenue for Steinhoff was attributable largely to financial restructuring measures by the company, with the sale of its e-commerce business, Showroomprivé, through its subsidiary Conforama and Austrian furniture retailer Rudolf Leiner, popularly known as Kika/Leiner, to Rene Benko’s Signa Holding.

However, five retailers – including The Spar Group, Steinhoff, and Woolworths Holdings – were among the 50 fastest growing Top 250 retailers in FY2018, Deloitte noted.

The table below outlines how South Africa’s biggest retailers compare in the Deloitte report.

# Retailer Countries FY2017 revenue ($m) FY2018 revenue ($m) % Change 5Y CAGR
64 Steinhoff 30 ~20 350 15 138 -25.6% +15.5%
100 Shoprite 15 11 294 10 586 -6.3% +8.0%
132 Spar Group 10 7 252 7 867 +3.9% +16.6%
162 Pick n Pay 7 6 225 6 513 +4.6% +6.9%
205 Woolworths 14 5 332 5 039 -5.5% +12.5%

Global retailers

According to Deloitte, the outlook for the global economy and the retail industry in 2020 is uncertain, with overall growth expected to be subdued, but positive.

Low growth in consumer spending and inflation remains low, while further uncertainty has been added by the Covid-19 outbreak in China.

“Countries that rely on China-led supply chains, such as Japan, South Korea and Taiwan, have faced disruption. Many businesses have suspended investments in their supply chains; others have adjusted and re-invested. Production has shifted from China to Vietnam, Mexico, and elsewhere,” Deloitte said.

Despite the waves hitting global retail, little is changed among the biggest retail giants in the world, with Wal-Mart retaining its position as the global leader in retail – by an insane margin.

Walmart registered year-on-year retail revenue growth of 2.8%, fuelled mainly by record growth in comparable store sales in the US. The company has focused on e-commerce as part of its omni-channel strategy – with a $5.4 billion investment in FY2018 – that led to growth in e-commerce sales by 40%.

Wal-Mart is again followed by Costco – but with over $370 billion in retail revenue separating the top two spots, it is nowhere close to toppling Wal-Mart.

Global online retailer Amazon has shifted one space in the ranking, now placing third, ahead of Germany’s Schwarz Group, and the Kroger Co, which slipped two spots.

These are the top 10 biggest retailers in the world:

# Group Country Countries of operation Retail Revenue (US$m)
1 Wal-Mart Stores United States 28 514 405
2 Costco Wholesale Corp United States 11 141 576
3 United States 16 140 211
4 Schwarz Group Germany 30 121 581
5 The Kroger Co. United States 1 117 527
6 Walgreens Boots Alliance United States 10 110 673
7 The Home Depot United States 3 108 203
8 Aldi Einkauf Germany 19 106 175
9 CVS Health Corporation United States 2 83 989
10 Tesco United Kingdom 8 82 799
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