Spotlight on South Africa: report from the Insight study tour

South Africa has some of the most advanced and innovative petrol forecourts, convenience stores and supermarkets in the world - all using the latest technologies.

While fundamentally different to European, American and other international markets, South Africa’s retail sector has a surprising number of similarities. This is because South African retail operators have closely studied international retail trends over the years, learnt from them, mirrored the best and built on it.

This continued benchmarking has allowed the market to develop at a faster pace than it would have done otherwise. As a result, South African operators have been able to accelerate their learning curve and time invested in development.

Consequently, the South African retail market has developed into a sophisticated, competitive and world class retail market.

In early February, Insight’s retail study tour provided delegates with an introduction and overview of the convenience retail landscape in South Africa.

The tour included visits to a cross section of c-stores, forecourt operators and larger format, franchised supermarkets plus a guided tour of the world’s largest Spar distribution centre in Johannesburg and its in-house retail design and development studio.

In addition to the site visits, there was a series of presentations from the leading fuel and c-store operators and a chance to meet with senior executives and management from these organisations.

The tour began in Johannesburg, the financial heart of South Africa, with an insightful overview of the market and economy from the director of retail services for Nielsen SA. Then it was off into the fast-paced and vibrant city of Johannesburg.

Store visits included a world-class Spar supermarket, twice winner of Spar SA Store of the Year award, and a meeting with store owners and operators; followed by a site visit to a newly rebuilt Engen Woolworths forecourt site.

The joint venture is similar to the one between BP and Marks & Spencer in the UK. In South Africa Engen is the leading fuel retailer and Woolworths is a market leader in fresh food and convenience retail.

Hosted by representatives from both Engen and Woolworths, the site visit was extremely interactive and provided a clear understanding of the dynamics of the partnership.

The Johannesburg tour also featured a presentation from the head of convenience retail for SASOL (South African Coal, Oil and Gas Corporation). SASOL is a South African company involved in mining, energy, chemicals and synfuels.

Over the last six years SASOL has aggressively developed its retail network in South Africa, focusing heavily on its c-store offer with a quality fresh food-to-go range and distinctive store branding. The presentation was followed by a visit to one of its latest forecourt c-stores.

Leaving Johannesburg the tour headed west to Cape Town. Locally referred to as the ‘mother city’, there was an opportunity to take in Cape Town’s beauty. An afternoon cable car tour up Table Mountain was followed by dinner at the Victoria and Alfred Waterfront, accompanied by the head of Woolworths convenience retail and the head of retail strategy for Engen.

Cape Town provided delegates with an insight into some of the forecourt c-store developments and joint ventures in the market. These included an impressive Pick n Pay c-store in Tokia and a Fresh Stop Caltex joint venture in Blouberg Strand.

Pick n Pay, South Africa’s largest supermarket retailer, has developed a c-store format with BP, which includes the Wild Bean Cafe offer and innovative design concepts and technology including electronic shelf edge labeling systems.

Fresh Stop is part of the Fruit & Veg City group, South Africa’s largest supplier and retailer of fresh produce. It has a strong business model with a focus on franchise operations, including Food Lovers Market; a dynamic format focused on fresh foods, food-to-go and cafe dining within a market-style retail outlet.

With a full programme during the week, several site visits, presentations, meetings and dinners, the study tour delivered huge insight into the South African market and an opportunity to learn about the latest developments.

For more details on the South African market please contact Nick Scherzer at Insight Research on +44 (0) 1938 556 090