Holding out for results
A rough recent trading update from Shoprite*, with an attempt at making it look pretty. But revenue that is up only 1.7%, is bleak, even if Shoprite continues to have a lot of products experiencing deflation (11 607 items are cheaper than a year ago). This hurts as operational costs are increasing while revenue struggles. The group also experienced a strike in its largest distribution centre in Gauteng, which accounts for over half of its distribution. Coupled with Pick n Pay starting to gain traction (albeit still no real movement on operational margins), I wonder if it is time to switch retailers? For now, I am not changing as I need some results to decide if this is just a temporary setback, or something more serious for Shoprite.