Pick n Pay's major mistake, which was "absolutely nuts."
Pick ‘n Pay CEO Sean Summers was highly critical of the decision to convert traditional Pick n Pay stores into QualiSave outlets, calling it a grave mistake that was “absolutely nuts.”
As part of its extensive Ekuseni plan, announced in 2022, Pick n Pay has converted many stores into QualiSave outlets. Ekuseni was made known as the "New Dawn" by stakeholders, with former CEO Pieter Boone touting it as the “biggest and most important change in Pick n Pay for many years”.
According to Boone, the strategy was formulated following a thorough study of the business, understanding its strengths and weaknesses. The plan involved implementing a fresh customer value proposition, expanding Boxer, gaining omnichannel and digital superiority, modernising operations, and assembling a high-performance team.
As a component of the revamped customer value proposition, Pick n Pay was divided into two brands that directly interact with customers.
- Pick n Pay QualiSave stores - catering to the lower- to middle-income segment of the market.
- Pick n Pay - catering to the middle to higher-income segment of the market.
The range of products available at Pick n Pay QualiSave stores totalled approximately 8,000. These stores prioritise providing essential items, along with a selection of fresh items and exceptional customer service.
In contrast, Pick n Pay stores provide customers with approximately 18,000 products and fulfil their expectations by offering a fully integrated omnichannel experience.
According to the statement, these two Pick n Pay brands, along with Boxer, will effectively cater to the market by addressing unique customer requirements and appealing to the diverse South African customer base.
Pick n Pay QualiSave was officially introduced in August 2022. As part of their strategy, the retailer aimed to rebrand 40% of their Pick n Pay supermarkets as Pick n Pay QualiSave. The Pick n Pay QualiSave store boasted a fresh layout, unique signage within the store, and a product assortment specifically catering to the expanding middle-class customer demographic.
“We are hugely excited by the positive customer response to the Pick n Pay QualiSave pilot stores. Our sales have increased, and customers are shopping more often with us.” Boone said.
In 2022, Pick n Pay informed investors that Pick n Pay QualiSave had been successful. However, Summers later disclosed that it had been a complete catastrophe.
According to him, Pick n Pay has always been present in lower-income areas. However, the QualiSave project caused them to lose focus. Pick n Pay QualiSave store is selling identical products to those offered by Boxer. Pick n Pay's Ekuseni and Qualisave plans displayed a flawed strategy that was effectively implemented.
Following Boone's departure, Summers assumed control and initiated the process of converting Qualisave locations to Pick n Pay stores, as well as rebranding select stores as Boxer.
Summers noted that having both Pick n Pay and Boxer as retail brands is a much more sustainable and sensible arrangement. According to him, the stores cater to various requirements and can prosper together in shopping malls and throughout South Africa.