News this week from PNA on its Namibian expansion; Massmart and OneCart collaboration increases; and Zimbabwe gets food production investment.
PNA opens flagship stores in Namibia
PNA has expanded retail operations into Namibia with two flagship stores opening this month at Wernhil Shopping Centre and Maerua Mall outlets. The new PNA stores will bring the group’s product range of stationery, art and craft materials, recreational and educational books to the Namibian market. With 114 independent owner-run franchise stores in South Africa, the PNA group has grown from its humble beginnings in 1992 to become a reputable, sought-after franchise entity and one of the market leaders in the competitive books, arts and crafts and stationary sector. The PNA business model is different from traditional franchise models in that store owners are empowered to tailor product offerings to meet the requirements of the communities they serve; while still carrying the goods all consumers would expect from the premier PNA brand. Herman Botha, PNA group marketing & sales executive said, “Our Namibian shoppers can expect stores light, bright and full of stationery. Another added-value to our shopper experience is our variety of specialised arts and crafts materials, and PNA will be partnering with prominent crafters in Windhoek to create a platform for likeminded crafters and artists by offering art and craft classes at their store in Maerua Mall”.
European investors aid food production in Zimbabwe
International private equity firm Spear Capital has completed its investment into the food manufacturing business Associated Foods Zimbabwe Private Limited (AFZ). AFZ plays a key role in value addition to agricultural goods from local farmers, and currently produces a range of popular food items such as jams, peanut butter, snacks, cereals, and canned products for the Zimbabwean market. Spear Capital’s investment into the business will be a part buy-out of existing shareholders, part working capital injection, and part capital expenditure, as well as investment into systems and equipment to improve the manufacturer’s environmental impact. The current food segment revenue in the region is expected to show an annual growth rate (CAGR 2022-2025) of 30%, resulting in a projected market volume for the sector of US$41m by 2025, which showcases the significant demand for AFZ’s products in the market. Investing in the company will increase the working capital to purchase raw materials, upgrade and expand current facilities, and increase capacity utilisation of the business to be a market leader in Zimbabwe.
Massmart and OneCart expand partnership
After Massmart acquired an 87.5% stake in on-demand multi-retailer marketplace, OneCart, in late 2021, the platform has experienced exponential Gross Merchandise Value (GMV) growth of over 200%. Massmart and OneCart are now expanding their partnership and by the end of 2022, OneCart plans to double the number of Massmart stores available on the app. This expansion includes adding the Makro Crown Mines, Carnival and Wonderboom stores to the app this month, whilst selected Builders stores will be added during July. “Not only does the platform act as an alternative customer channel for some of the country’s most established brands, it is also the first direct-to-consumer channel for smaller, emerging retailers and SME’s entering the online market,” explains Lynton Peters, Founder and CEO of OneCart. Currently, OneCart offers customers access to 28 Game and 12 Makro stores – allowing them to shop over 10,000 products across multiple categories, including pantry items, liquor, toys, baby products and small appliances. These orders are delivered within one hour or in a specific time slot chosen by the customer.
SAITEX returns with Big 7
After a two-year forced hiatus due to Covid lockdowns and restrictions, multi-sector trade show SAITEX is back, now in its 28th year and being co-hosted with food and beverage show Africa’s Big 7 and the Halal International Trade Expo at the Gallagher Convention Centre between 19 and 21 June 2022. The event is bringing together leading buyers and suppliers from over 25 countries, showcasing their latest products and service innovations across seven exhibitor zones. The expo will also feature a series of technical masterclasses run over three days, aimed at paving the way forward for businesses across the trade and township economy sectors. The increasing importance of Africa’s township economy is featured at SAITEX in a stakeholder engagement session presented by the Gauteng Department of Economic Development, where public and private stakeholders will delve into the details of the recently passed Township Economic Development Bill and the Township Economy Partnership Fund, considering its impact on individual businesses and existing commercial activity moving forward. With an estimated 355 million middleclass consumers, Africa has one the most rapidly growing retail markets in the world, making SAITEX a must-attend event for business owners, entrepreneurs, retailers, wholesalers and distributors from across the continent.
Revlon filed for Chapter 11 bankruptcy protection on Wednesday evening as it grappled with a cumbersome debt load and a snarled supply chain. The cosmetics giant said it expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help to support its day-to-day operations. The filing “will allow Revlon to offer our consumers the iconic products we’ve delivered for decades, while providing a clearer path for our future growth,” Revlon President and CEO Debra Perelman said in a recent press release. Revlon is the first major consumer-facing business to file for bankruptcy protection in what has been a long pause of distress in the retail sector.
McKinsey’s Global Institute Report predicts an 82 percent growth in Africa’s household consumption from 2020 to 2025 to the tune of $2.3 billion. Nigeria, Africa’s largest economy, is expected to play a key role in achieving this growth with an estimated $96 billion spend, the highest on the continent. Food, beverages and other consumer goods are expected to lead the pack. London-based research firm, Euromonitor, in its report, ‘Retailing in 2021: The Big Picture,’ stated that the Nigeria consumer goods segment grew by 9.3 percent to a six-year high of N9.76 trillion. Breaking down the figure, the report indicated that store-based retailing accounted for N9.58 trillion of the total while online trading was N178.2 billion. The 2021 Global Retail Development Index similarly reported a three percent increase in total retail sales valued at $108m. Back home, the official statistics agency, the National Bureau of Statistics (NBS), noted an 8.62 percent growth in trade in 2021, a rebound from a six-year slump.
*Additional sources: The Guardian Nigeria, AdWeek, Total Retail Report, Perch Interactive, Kantar, Onclusive, CMO Council.
This week in numbers
According to the Pietermaritzburg Economic Justice and Dignity Group’s May 2022 household affordability index, the price of cooking oil in South Africa has risen over 50% in the past year. Among other consumer goods, this price jump has made consumers rethink how they can save towards their groceries, and one of the ways in which people can save towards household expenditure is through rewards programmes from various institutions, reports Assupol. Assupol launched its rewards programme in 2019, enabling people to save up to R1,250 per month (or R15,000 per year) in monthly essentials. The data provided by Assupol shows that cooking oil was the highest product of choice whereby consumers were saving money.
QUOTE of the week:
“The inability to identify influencers and proceed to track the results they generate accurately has been a longstanding gripe with influencer marketing. In fact, 62% of iPhone users chose to opt-out of app usage tracking following Apple’s iOS 14.5 update. The answer? First-party data,” writes Kirsty Bisset, MD of HaveYouHeard Durban, on Retailing Africa.
Main image credit: PNA.
*Stocktake is a weekly roundup of current FMCG retailing and brand news, curated and edited by Retailing Africa Publisher & Editor, Louise Burgers. Keep the industry updated and send your announcements and news to: email@example.com.
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