Pick n Pay shuts down 32 additional stores across South Africa
Pick n Pay, a South African retailer, has confirmed the shutdown of 32 supermarkets nationwide as part of its ongoing turnaround efforts.
Top South African retailer Pick n Pay has revealed the closure of 32 more supermarkets nationwide as part of its ongoing turnaround strategy.
The move comes amid efforts to stabilise the business following significant financial losses in recent years.
In its trading update for the 45 weeks ending 5 January 2025, Pick n Pay revealed that 24 company-owned stores and eight franchise stores have shut their doors.
In addition, five company-owned stores were converted into franchise outlets.
This decision is part of the retailer’s ‘Store Estate Reset’ plan aimed at optimising operations and focusing on profitable locations.
However, despite these closures, Pick n Pay has shown steady improvements.
Like-for-like sales grew by 1.6%, with Pick n Pay South Africa reporting a 1.9% increase.
However, when excluding like-for-like adjustments, overall sales saw a decline of 0.4% at the group level and 0.1% for South Africa.
Turnaround strategy
The group embarked on a major turnaround strategy after recording an after-tax loss of R3.2 billion for the year ended 25 February 2024 (FY24).
This followed a R2.8 billion non-cash impairment on the assets of Pick n Pay company-owned stores.
Pick n Pay Grocery recorded a R1.5 billion trading loss during the period, undermining Boxer’s R1.9 trading profit.
As reported by The South African website, part of the turnaround involved raising funds from shareholders through a Rights Offer – which raised R4 billion in August 2024 and was more than double oversubscribed – as well as separately listing Boxer stores, which added another R8 billion to the pot.
Not all doom and gloom
Not all areas of the business faced setbacks.
Clothing sales in standalone stores grew by 10%, with online sales soaring by 42.5%, driven by the success of Pick n Pay asap! and partnerships with the Mr D app.
Boxer stores remained a strong performer, recording 12% growth (7.7% like-for-like) for the first half of FY25 and maintaining double-digit growth throughout the 45-week period.
Pick n Pay also managed to control its internal selling price inflation, which dropped to 2.4% from the 8.2% reported in FY24, reflecting better pricing strategies and cost management.