To date Choppies has 72 outlets in Botswana and intend to reach a target of 100 stores. Spar sarkets on the other hand are also expanding and currently have 16 stores dotted around Botswana.
A large portion of the modern retail sector in Botswana is dominated by a small number of firms, Which control franchises or are strategic partners of retail transnationals. These include Choppies Group, Pick n Pay, Shoprite, Spar, Woolworths, and other retailers who are in the clothing and furniture retail space.
Despite the fact that the Botswana retail industry experienced a boom over the last couple of decades, the major retail companies in Botswana are from South Africa-very few are from Botswana. Juma has described this trend as a ‘worrisome trend’ as it shows that Botswana is not taking a leading role to benefit from the sector. Choppies, however, are a proud exception to this, being a Botswana born and bred company and headquartered in Botswana.
The growth of retail in Botswana has been attributed to Botswana’s economic growth over the past 15 years, rising disposable incomes, the country’s stable political environment, and friendly business regime.
The presence of new malls in the country and ever-changing consumer preferences and spending patterns continue supporting growth of this sector.
In terms of challenges moving forward, retailers are faced with power and water shortages in the country.
An increasingly large number of businesses have entered this industry and both formal and informal retail traders have experienced growth over the years, including Choppies. Although South Africa is already widely served by a number of large retail chains, it has a substantial market with sizeable prospects in semi-urban and urban areas.
The South African economy seems to be progressing to one that is consumer driven, as mining and manufacturing decline, industry expansion falls on the hands of retailers.
The country continues to develop new malls and shopping centres and this increasingly rapid establishment has in the recent years seen not only cities expanding their retail area but also some townships have had malls and shopping centres being developed. This again provides great opportunity for Choppies to continue to drive it’s expansion plan.
The convenience channel and online remain limited with both providing the chance for retailers to create a differentiated, invariably mission-led, offer for consumers. While spending online is growing in non-food and services (tickets etc), given the lack of internet and supply chain infrastructure there is little expectation that online grocery retailing will emerge in a large-scale way in the medium term.
Choppies is adding scale and developing an offer that could enable it to win with lower income consumers in individual cities. If it is able to gain traction with this it could encourage competitors to react. In the medium term the focus will remain on winning with the core supermarket format.