Not only are stores closing, but the company is also reducing store sizes and revamping multiple store locations. More closures are planned for the rest of the year.

Redefine Properties, the owner of numerous prominent shopping malls in South Africa, has declared that it will be reclaiming 10,000 square meters from Pick n Pay. The shopping malls owned by Redefine include some of the largest in South Africa, such as Centurion Mall, Blue Route Mall, Cradlestone Mall, and East Rand Mall. The list of properties in its portfolio comprises of Benmore Centre, Centurion Lifestyle Centre, Kyalami Corner, Goldfields Mall, Golden Walk, Kenilworth Centre, and Horizon Shopping Centre.

During its Capital Markets Day presentation, it announced plans to reclaim 10,000 square meters from Pick n Pay. This move aims to strategically utilise space in their malls.

The presence of Pick n Pay as the anchor tenant in many shopping malls has proven to be a hindrance, as it fails to generate the same amount of foot traffic as Checkers does. The idea is that, as Pick n Pay relinquishes space, shopping malls stand to potentially raise their rental rates and improve the shopping experience for customers.

As previously stated, Pick n Pay CEO Sean Summers says their turnaround strategy involves evaluating the performance of all their stores. Multiple stores were found to be in critical condition, attributed to various factors such as shifts in local demographics or issues within the shopping centre.

Summers announced the closure of the struggling stores, stating that they would be shut down and eliminated due to their lack of future prospects.

As part of the turnaround plan, and a surprise announcement, certain Pick n Pay stores may be transformed into Boxer stores if the local demographics support such a change.  It was announced that the Boxer team was actively pursuing over 10 Pick n Pay store conversions.

Another significant update involves the conversion of Qualisave branded stores back to Pick n Pay stores by the company.

Pick n Pay has already shut down a total of sixteen supermarkets, consisting of four corporate and twelve franchise locations, additional closures are expected through the year.

Pick n Pays last trading statement provided a financial and operational update for the 21 weeks ended 21 July 2024. Pick n Pay's sales experienced a meagre 0.1% increase during the time frame, well below the inflation rate.

According to Pick n Pay, the reason for its total sales falling behind like-for-like sales was due to the closure of multiple stores during the period.

To provide context, Shoprite/Checkers achieved a 10% growth over a similar period.

It's worth mentioning that Checkers and Shoprite are filling the void left by Pick n Pay's store closures, occupying a significant portion of the retail area.

Despite the downward trend in performance and store closures, Pick n Pay is maintaining an optimistic outlook.  Summers announced that their management team has made promising strides in enacting their turnaround.  Like-for-like sales have steadily improved, from -0.4% in H2 FY24 to +2.0% over the last few months, though one area of concern is the underwhelming -0.8% performance in like-for-like sales for its South African franchise supermarkets, according to Daily Investor.

The franchise supermarkets have been consistently outperforming company owned stores, creating a push to improve their company owned stores and to revitalise the performance of their franchise stores.

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