Johannesburg – Spar needs an urgent turnaround to protect jobs and maintain competition in South Africa’s concentrated food retail sector, according to Anchor Capital investment analyst Stephan Erasmus.
Speaking to The Money Show, Erasmus said Spar’s relationship with its independent retailers has deteriorated following several setbacks, including its troubled SAP software implementation.
The retailer’s franchisee loyalty has fallen from 83% in 2022 to 78%, putting pressure on its wholesale business.
“Ultimately, I think if you solve the relationship at the top and everybody’s agreed on where they’re going, that number can tick up,” Erasmus said.
“But I don’t think there’s a heck of a lot of time. These things do require urgent action.”
Erasmus said Spar’s survival was important because it is a major employer and one of only four major listed food retailers in South Africa, alongside Shoprite, Pick n Pay and Woolworths.
“I think it’s in the general interest to keep competition,” he said, warning that “losing another retailer arguably would not be great for markets.”
He said appointing a new board chair trusted by the Spar Guild and with strong retail experience could help repair relations and support the turnaround.
Follow African Insider on Facebook, X and Instagram
Picture: Copilot
For more African news, visit Africaninsider.com
Compiled by Betha Madhomu
