Sales via the Checkers Sixty60 service surged nearly 50% in the six months ended December, cementing its dominant position in the online food delivery services market.
Shoprite, Africa’s largest grocery retailer, said on Tuesday in a trading update that the Checkers Sixty60 on-demand platform reported a 47.1% surge in sales in the period under review.
The exponential growth of the digital platform has seen the group move to take full ownership of the Pingo delivery service — its logistics partner behind the Checkers Sixty60 service.
The competition commission has already recommended that the competition tribunal approve the deal without conditions.
Pingo was established in 2022 through an equal joint venture between Shoprite and RTT Group. The partnership followed the rapid growth of Shoprite’s on-demand delivery of groceries, Checkers Sixty60.
Checkers Sixty60 is SA’s top on-demand grocery delivery app, with more than 2.3-million downloads.
Online food delivery services have grown rapidly in recent years, driven by the ease and safety they offer, especially in the wake of the Covid-19 pandemic.
The volume of orders in SA’s food delivery market was expected to reach $1.1bn for 2024, according to Statista, as its convenience and efficiency continues to attract high-end consumers.
Statista expects the sector to record 11.34% growth in the next five years, resulting in a market volume of $2bn by 2029.
The trading update shows Shoprite Holdings increased sales from continuing operations by 9.6% to about R128.6bn at the halfway stage of the financial year.
Sales exclude its furniture business, which is held for sale, and excluding the impact of Ghana hyperinflation, sale of merchandise increased 9.5%.
Supermarkets RSA’s sales for the first half ended December 29 rose 10.4% to R107.7bn, while those of Supermarkets Non-RSA were up 4.1% to R11bn. Other operating segment sales rose 6.2% to R9.9bn.
The group’s core business, Supermarkets RSA, contributed 83.7% to group sales, with same-store sales growth of 6.1%.
Internal selling price inflation averaged 1.9% for the period.
Checkers and Checkers Hyper, inclusive of Checkers Sixty60, reported sales growth of 13.5% with online sales from its Checkers Sixty60 on-demand platform increasing 47.1%.
Shoprite and Usave reported sales growth of 6.7%, while Shoprite and Checkers LiquorShop sales increased 12.2%.
Supermarkets RSA opened a net 248 stores over the past 12 months to total 2,485 stores. Of these net new openings, 30 were Shoprite, 28 Usave, 34 Checkers and 80 LiquorShop stores. The remaining 76 were new format, adjacent category specialist stores. Petshop Science added 53 new stores to total 128 stores, Checkers Outdoor opened 11 new stores to total 26 stores, Uniq clothing by Checkers added 11 new stores to total 30 stores and Little Me opened one new store to total 12 stores.
Supermarkets Non-RSA’s store base increased by a net 10 stores over the past 12 months to 269 stores operating in nine countries.
The group’s other operating segments comprising OK Franchise, Transpharm, Medirite Pharmacies, Red Star Wholesale Catering Services, Computicket and its remaining Angola and Mozambique furniture business, reported sales growth of 6.2%.
The group’s sales to its OK Franchise operation increased by 8.8%. The OK Franchise store base increased by a net of 18 stores over the 12 months to end the period with 623 stores.
The group opened six Medirite Plus stand-alone drug stores to end the period with 17 stores in this new format. Its in-store Medirite pharmacies, which totalled 122 for the period, are excluded from these numbers, as these are located within supermarkets.
Shoprite signed an agreement in September 2024 to dispose of the furniture business including the OK Furniture and House and Home brands (excluding Angola and Mozambique operations) to Pepkor.
The agreement is pending the fulfilment of the conditions precedent, which includes Competition Commission approval.
During the period, the group repurchased shares to the value of R997m.
“Shoprite’s corporate strategic actions reveal a focused approach to portfolio optimisation,” said an IG senior market analyst.
“The divestment of the furniture business to Pepkor, combined with a significant share buyback programme, indicates confidence in the core business strategy.
“The completion of the Pingo delivery acquisition strengthens their e-commerce capabilities, suggesting a clear vision for future growth.
“Looking ahead, Shoprite appears well-positioned to capitalise on continued digital commerce momentum, leveraging its expanded store network and specialist category development,” said Murison.
The group, which is valued at almost R170bn on the JSE, will release its interim results on March 4.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.