As Majid Al Futtaim targets further expansion in Kenya and BinDawood continues to add new stores, we round up news from the region and its largest retailers.
Pick n Pay said the performance was driven by like-for-like growth of 4.8% in value terms, with like-for-like volume sales rising by 5.1%. Selling prices at its stores fell by 0.3% underlining the challenging economic and operating environment in which it is working in and how it is continuing to invest in prices to win in that market.
Noting the backdrop that it is working in Pick n Pay said the results ‘…in a very challenging trading environment, underlines the effective and consistent execution of the Group's long-term plan. Over the past six years, a strong focus on improving cost and operational effectiveness has enabled the Group to invest in a winning customer offer through lower prices, more attractive promotions, better and more innovative products, compelling value-added services, and brighter and more modern stores’.
The retailer noted that is core South Africa division saw comparable turnover growth of 7.4%. It said its Pick n Pay and Boxer brands had enjoyed good growth and seen ‘consistent market share gains across the year’. Outside of its home market Pick n Pay said it had seen challenges in Zambia and Zimbabwe.
As UAE-based LuLu and Majid Al Futtaim and Qatar-based Al Meera discuss their expansion plans for 2019 and into the short term, we round up news from the region.
UAE-based LuLu is aiming to open 32 hypermarkets in 2019. The retailer has said it is looking to expand in GCC countries, where it aims to add 29, including 12 in the UAE, in addition to the 87 it currently operates, Egypt, Indonesia and Malaysia. The importance of the countries where it is aiming to expand is underlined by LuLu saying that out of its AED25.7bn (US$7.0bn) in revenue, 60% was generated in the UAE, 10% in Saudi Arabia and 5% in India.
In Saudi Arabia LuLu has signed an agreement with the Saudi Arabian National Guard covering two shopping centres and seven supermarkets in Dammam and Al Ahsa, while to support its expansion it has said it will open a 1,000,000 sq. ft logistics centre in the King Abdulla Economic City. In Egypt it has said it will open four new hypermarkets, with two to be opened in 2019, while it will look to operate nine by the end of 2020.
Finally, the retailer said it was looking to expand strongly in India through the addition of shopping centres and hypermarkets in the cities of Bengaluru, Chennai, Lucknow, Thiruvananthapuram and Vishakhapatnam. The new stores will add to its existing presence in Kochi.
In an interview, MAF Carrefour’s country manager for Kenya and Uganda, Franck Moreau, has said the retailer is looking to grow its presence in Kenya and across the wider eastern and southern Africa region. Moreau said MAF plans to enter as many as five countries in the next four years, with entry into South Africa a consideration. He noted that if MAF were to enter South Africa it would be through acquisition, rather than organic expansion. In 2019 Moreau said MAF will open two more stores in Kenya and enter at least one new country.
Qatar-based Al Meera has held its Extraordinary General Assembly, which has led to it announcing several initiatives. First, the retailer approved an increase in the share of its foreign ownership to 49%. Secondly, it said it was aiming to increase its selling area to more than 100,000 sq. m by the end of 2019. This is up from its initial plan to grow its sales space by 97,000 sq. m.
The expansion in selling space will be driven by new stores, rather than extensions of existing sites. Al Meera said it would open a new centre in Rawdat Al Hamama, which would open in Q3 2019, while it was also building the Al Jumailia and Al Shamal branches and investigating opportunities for five further developments. The retailer is also aiming to open 10 MAAR convenience stores in Qatar Rail. A third strategic pillar will be private label, which Al Meera said it would relaunch during 2019. The relaunch will look at product’s ‘design, diversity, range, packaging, and re-branding’.
To continue its growth trajectory Union Coop said it was looking to open a further 17 sites in the medium term and has received approval to expand outside Dubai. Union Coop said it is looking for land in Abu Dhabi.
As AliExpress and LuLu launch new promotions, competition rises online and in grocery retailing more widely in the UAE we round up news from the region.
To mark its ninth year of operation in the country, AliExpress is set to launch an anniversary sale that will enable shoppers to enjoy discounts of up to 50% across a range of 100m products. The four-day sale period will also allow shoppers to try different fulfilment and delivery options. As part of promotion AliExpress is also helping a shopping event in Riyadh, which will see it open a pop-up shop to showcase a selection of AliExpress products, across home goods and electronics, and smart shopping options.
As competition within the food delivery business rises in the UAE the market is consolidating around the largest companies. The latest development in the channel has seen India-based Zomato being acquired by the Delivery Hero Group for US$172m. The purchase will see Delivery Hero gain a further 1.2m orders and US$2m in revenue a month.
Building on the on-going trend in the region for countries looking to grow more at home, LuLu has launched a campaign under the tagline ‘From Our Land: Proudly from KSA’. The promotion will run at all its stores in the country and will put a spotlight on locally grown food products, especially organic items.
The acting CEO of Adnoc Distribution, Saeed Mubarak Al Rashdi, has said its first service stations in Saudi Arabia are performing ‘above expectations’. The discussion comes after the company opened its first sites in Saudi Arabia during Q4 2018.
As part of an interview with Arabian Business, Choithrams’ CEO, Rajiv Warrier, has said the local market has become ‘much more competitive… than it was a few years back.’ Warrier said the rising competition meant it was a great time to be a shopper, but was creating challenges for retailers. To compete Warrier said Choithrams would look to adapt its offer to meet the new demands from shoppers. From a channel point of view this is seeing it investigate opportunities within ecommerce, while it could also lead to it expanding further in Bahrain.
Carrefour has launched a floating supermarket in Dubai. The supermarket is called: ‘Carrefour Bites and More by the Shore’.
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