Pick n Pay to open 100 new stores as turnaround plan gains momentum
Nicola Mawson
South Africa’s second largest grocery store, Pick n Pay is gearing up for an aggressive expansion strategy that will see new outlets sprout across the nation from 2026.
The retailer, which also has clothing outlets, is nearing the completion of a significant turnaround plan aimed at rectifying its previous struggles, including shrinking market share and substantial financial losses.
This includes inroads in sorting out its balance sheet, a R4 billion rights offer that saw the Ackerman family relinquish control of what started as a family business, and listing Boxer Superstores to raise as much as R8bn.
In a candid discussion with Business Report yesterday, Pick n Pay CEO Sean Summers articulated the company’s robust recovery initiatives that included shedding its Boxer brand through a public listing, closing downtrodden stores, and refining its financial health.
“We’re on a journey, we’ve commenced. We’re in a profoundly different place to what we were in six months ago, never mind a year ago,” Summers said, speaking on the sidelines of opening a revamped clothing store in the Mall of Africa in Midrand.
Summers revealed plans to inject capital into opening new retail locations beginning in mid-2025, targeting an ambitious total of 100 new stores within the next three years. This will notably comprise two corporate outlets and six franchise shops.
As part of an ongoing revitalisation effort, the company aims to refresh existing stores that have been “left behind” amid the competitive landscape of grocery retailing.
“These stores need to be modernised and brought up to speed,” Summers explained, highlighting that revitalisation is as important as expansion.
The urgent need for updates was underscored as the retailer neared the closure of a net 17 stores last month which were deemed “a drag on the system.”
Moreover, the company anticipates the addition of 24 additional locations by year’s end.
Pick n Pay's shares have surged by 25.29% over the past six months.
Despite reporting a core loss of R1.5 billion for the financial year 2024, Summers optimistically stated that the group was on course to halve its losses with what he described as “encouraging progress” now evident.
Losses in the 26 weeks to August 25 escalated by 44.8%, yet the tailwinds of strategic efforts are evident.
“I did have grey hair before, but I feel 10 years younger,” said Summers, said Summers commenting on his time at Pick n Pay since his return as CEO last October.
The Mall of Africa outlet, which features aspects such as live green walls that indicate its commitment to sustainability, aims to create “a dynamic shopping experience that goes beyond affordability,” Hazel Pillay, executive for Pick n Pay Clothing, said in a statement.
Its design elements also bring in an African feeling, representing Pick n Pay’s continental footprint.
In the 26 weeks to August 25, Pick n Pay closed a net 17 stores, which Summer said were “a drag on the system”. It aims to open another 24 shops by the end of the year. Rosebank and the flagship location at Gateway have also been revamped as part of its expansion strategy.
Summers also noted that the vibe in the stores and at head office, a common complaint from customers who had dealt with grumpy cashiers, was changing.
“People in the company are having fun again,” he said of seeing laughter, smiles, positivity, and hope across the company.
“The hearts, minds, and souls of people make a company,” he told the audience assembled at the Mall of Africa store opening, where the outlet displayed the ‘Pick n Pay Resort Collection 2024’, a limited-edition collection designed by Gavin Rajah and Alexandra Avgitidis of A.M Studio.
BUSINESS REPORT