A colossus falters

than a year ago.

Price growth in Shoprite’s supermarkets outside SA has also nosedived; internal inflation in its African stores fell from 14.4% in the previous year to just 1.1% for the year.

Still, Engelbrecht says Shoprite management “is by no means disillusioned”.

“It’s very easy in the current economic and political climate to become despondent, but I can tell you we’re not — definitely not.”

In fact, Shoprite says its SA supermarkets have produced their highest real growth in the past three years, lifting sales 5.7%, partly because it opened new stores.

However, he admits that the inflation slump between March and June this year took him by surprise. So too did events in Angola: the devaluation of the Angolan kwanza cost the group R251m in an exchange-rate loss, and hyperinflation forced a change to Shoprite’s accounting standard in the country, contributing to a 7% drop in turnover from its African businesses.

SA’S grindingly tough economy is being felt in many ways other than lower sales.

Shoprite revealed that burglaries at its SA stores have soared an eye-popping 34.9%, with 489 armed robberies forcing an almost 15% increase in spend on measures to keep staff and customers safe.

Aside from the cost of the burglaries, “for about three weeks afterwards there are no customers in those stores — so the effect on turnover is significant”, says Engelbrecht.

With Shoprite-branded stores also positioned largely in lowerincome areas, service delivery protests have become a problem, costing the company 150 trading days in the year under review.

SHOPRITE’S STRESS