Discount retailer Boxer is targeting a R106bn “whitespace opportunity” in the local grocery market as it rallies to lead the discount segment and expand its footprint. This potential market includes areas where Boxer has yet to establish a presence, but sees high demand for its discount-driven offerings.
Boxer’s strategy also involves capturing portion of SA’s informal grocery sector, which represents 34% of the market. With plans to roll out more stores in underserved regions, it seeks to formalise grocery shopping in these areas by offering a structured, competitively priced alternative to informal vendors, it said in a Sens announcement on Monday.
The strategy is designed to help the retailer exploit identified whitespace. But its success hinges on expanding into new regions and leveraging its competitive discounts.
“Boxer believes that it is well positioned to lead increased penetration of the discounter category in SA over the coming years. As at the date of this announcement, Futureworld, a global strategy partner, estimates a potential R106bn of formal retail grocery spend in Boxer’s South African customer target market in locations without a Boxer presence ‘whitespace opportunity’,” it said.
“Boxer’s ability to realise this market potential through sales growth is a function of its ability to extend its store estate into new regions, offer customers a compelling value proposition and thus gain market share from incumbent retailers within these regions.”
Boxer’s approach centres on high volume, value for money, operational efficiency and store expansion
On August 25, Boxer was operating 489 stores across three formats: Boxer Superstores, Boxer Liquors and Boxer Build. Boxer said that for the rest of this financial year it planned to add 53 stores, bringing the total new openings for the year to 65.
This strategy follows a strong performance in the first half of the 2025 financial year, during which Boxer achieved a 12% increase in turnover, reaching R19.8bn, and a 11.8% rise in trading profit, totalling R809m.
Boxer’s strongest presence has traditionally been in KwaZulu-Natal and the Eastern Cape. However, it has expanded to all nine provinces and made inroads into the Eswatini market. Gauteng had emerged as a major target for new openings, the retailer said.
Meanwhile, parent company Pick n Pay has closed 14 stores in the past six months, including one in Kimberley, which was converted into a Boxer store to better align with changing demographics in the area.
Group CEO Sean Summers told Business Day that shifting local demographics had affected the viability of older Pick n Pay stores, making the Boxer format a better fit in areas where cost structures were shifting.
“In Kimberley, the market for the traditional Pick n Pay has completely changed. We have converted that to a Boxer and we have no doubt Boxer is more capable of trading successfully in that marketplace,” he said.
According to Summers, the conversion process incurred costs, especially when a store shifted to a franchise model, but Boxer’s lower operating costs made it a more viable option in certain regions, he said.
Boxer has also announced long-awaited details of its listing plans, which are on track for later in 2024.
Boxer Retail will list all of its issued ordinary shares on the JSE’s main board, with a secondary listing on the A2X, and proposes to offer for subscription newly issued shares to selected prospective investors.
Pick n Pay previously announced its intention to raise R6bn-R8bn through the offer, and now expects the base size of the offer to be towards the upper end of the guidance provided.
Additionally, the offer was expected to include an overallotment option, which would be customary for transactions of that nature, to facilitate stabilisation activities.
The overallotment option was not expected to exceed R500m and would be settled, if required, through the issue of additional newly issued shares.
Application will be made to admit the shares to listing and trading on the JSE in the personal care, drug and grocery stores — food retailers and wholesalers sector under the abbreviated name “Boxer”, share code “BOX,” as well as on A2X, the company said in a statement on Monday.
As part of an intragroup restructuring, which will be concluded before the offer and admission, Boxer Superstores and its subsidiaries will become a wholly owned subsidiary of Boxer Retail and form the “Boxer Group”. More details regarding the restructuring, as well as the final structure and size of the offer and other information regarding the Boxer Group, will be set out in the prelisting statement to be issued by the company.
Boxer is SA’s fastest-growing grocery chain, with industry leading market share of the discount grocery segment.
It provides a focused range of quality, affordable products and services to customers in the lower-to-middle-income urban, peri-urban and rural SA and Eswatini communities. Boxer stores are located in high footfall areas, often in regional community centres close to public transportation hubs.
Rand Merchant Bank, Morgan Stanley, Absa Bank and Standard Bank are advising the Boxer Group and Pick n Pay in relation to the offer and admission.
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