How do grocers rate in their efforts to shield consumers?

South Africa’s big supermarket groups are in a quiet war over inflation. It is not only a battle for the consumer wallet but also a fight for credibility.

The question is how much are they really doing to shield households from the relentless rise in food prices, and who does it best?

The stakes are high with consumers living in one of the most unequal societies in the world, where unemployment is staggering at 31.9% and the national minimum wage is about R4,800 a month.

The Pietermaritzburg Economic Justice and Dignity household affordability index puts the cost of a basic food basket at more than R5,000 a month, depending on the city. That means millions of South Africans are spending more than a full minimum wage just to keep food on the table.

Against that backdrop, the grocers’ role in shaping the price of food is not just a commercial issue but a social one.

Stats SA’s latest consumer inflation numbers showed a slowdown to 3.5% in November from 3.6%, which was the highest level in more than a year, up from 3.4% in September, even though core inflation, which excludes volatile energy and food prices, rose to 3.2%.

Consumer inflation fell to 3% in June, down from 5.1% a year earlier, thanks largely to lower fuel costs. But food told a different story. Inflation in food and non-alcoholic beverages accelerated from 5.1% in June last year to 5.7% in July, with beef and vegetables being the main culprits.

This is the benchmark the grocers are measured against and here’s how they stack up.

Shoprite’s internal selling price inflation for the year to end-June sat at 2.3%, less than half the national food inflation rate. Pick n Pay recorded internal selling price inflation of 2.1% for the year to end-March, while its discount star Boxer kept prices almost flat, up just 0.3%. Woolworths reported 5.3% inflation in its food segment.

That means Shoprite and Pick n Pay managed to hold back price growth to a fraction of what Stats SA recorded in the food and non-alcoholic beverage category, while Woolworths, with its more upmarket customer base and premium products, broadly tracked the official food inflation numbers.

A Nedbank food retail price survey has shown that Shoprite remains the cheapest major supermarket, though its price gap over rivals has narrowed slightly. Boxer, which serves lower-income shoppers, was the overall cheapest retailer across a smaller basket of goods, edging out Makro and undercutting its sister brand Pick n Pay by 4.3%.

Promotions have slowed across the industry, indicating that retailers are protecting margins despite consumer strain. Shoprite continues to dominate in pricing, growth and market share, earning Nedbank’s only “overweight” investment rating, while Boxer and Woolworths show solid momentum.

Promotions have slowed across the industry, indicating that retailers are protecting margins despite consumer strain.

In contrast, Pick n Pay and Spar remain in prolonged recovery mode.

For the year to end-June, Shoprite posted a bumper set of results, pushing annual sales above R250bn for the first time. Revenue rose 8.6%, and its middle-income chain, Checkers, continued its bullish expansion with sales jumping 13.8%.

But the real story lies in pricing. CEO Pieter Engelbrecht said the group returned R16.5bn to customers at the till through discounts and promotions while keeping inflation low. At some points in the year, internal inflation dipped as low as 1.9%, according to Engelbrecht.

“It is not true that prices never come down,” he said, pointing out that in one month alone 13,300 items were cheaper than the year before.

This strategy of aggressive promotions, bulk buying and tightly managed supply chains has paid off. Shoprite not only grew sales volumes, a rarity in a shrinking economy, but it also created nearly 9,000 jobs in one year. It now employs more than 168,000 people directly and plans to add another 10,000 jobs this financial year.

Pick n Pay’s turnaround story is less glittering, but it has scored a win in the inflation battle. That has helped the group keep price increases sharply below June’s food inflation rate, even as it lost some ground on profitability. Earnings fell, but the group has argued that protecting consumers from price shocks is essential to rebuilding trust in the brand.

Read: SA retailers expand but face market saturation

For a retailer under pressure, low inflation is a way to claw back relevance. The market has largely written down the value of Pick n Pay’s core supermarkets, betting instead on Boxer as the compounding asset that can rival Shoprite in the discount space.

Woolworths continues to post double-digit sales growth, with turnover rising 11% in its latest financial year. The group credited new product innovation, online growth and strong basket sizes. But its customers have not been as shielded from price increases as those of Shoprite and Pick n Pay, largely because its value proposition lies in quality, convenience and innovation more than low prices.

Labour market

Grocer inflation policies, however, cannot be divorced from the labour market. Staff pay in retail is under scrutiny after shareholder activism group Just Share found that Shoprite pays one of the lowest disclosed internal minimum wages in the JSE top 40: R71,674 a year, or just under R6,000 a month before deductions.

That is barely above the national minimum wage and far below the R12,000-R15,000 living wage proposed by campaigners.

By comparison, Woolworths’ internal minimum is R99,450 a year, about 39% higher.

Pick n Pay has been less transparent, saying only that wages are guided by union agreements and benefits packages.

This shows that while retailers hold back food price inflation to help customers, many of their own employees remain trapped by wages that barely cover the cost of the food baskets they sell.

Engelbrecht took home R87m, up from R83m in 2024, Woolworths CEO Roy Bagattini earned R80m and Pick n Pay’s Sean Summers received R25m, more than double the R10m he earned in the previous year.

Shoprite spent nearly R5bn on new stores and upgrades last year and plans R7.9bn more this year. Woolworths is doubling down on supply chain efficiency and online growth. Pick n Pay is trying to restructure while maintaining Boxer’s growth momentum.

Nedbank corporate and investment banking analyst Paul Steegers said Shoprite’s ability to keep its internal inflation below the official consumer price index (CPI) without eroding margins reflects its pricing dominance and operational discipline.

He said Shoprite balances promotions to stimulate demand and drive volumes, which in turn leads to supplier rebates and stronger gross margins. Its strong product availability and expansion into new growth areas keep it well positioned to gain market share.

Boxer’s deflationary pricing continues to fuel growth in the lower-income segment, he said, while Woolworths’ slower-moving internal inflation reflects its exposure to high-cost categories such as coffee and chocolate and its ability to charge a premium through product innovation and quality.

He said Pick n Pay’s turnaround depends on upgrading its corporate store base, closing unprofitable outlets and improving franchise operations after years of underinvestment. Spar’s recovery hinges on delivering its new IT and distribution systems to restore franchise loyalty.

Echoing these views, MP9 Asset Management chief investment officer Aheesh Singh says Shoprite’s scale gives it “room to absorb costs and still protect its margins” though sudden cost spikes remain a risk.

“Woolworths’ strategy shows the power of brand trust, with customers willing to accept price increases because they get consistent quality,” he said.

Pick n Pay’s back-to-basic approach is “the right plan, but still in the early stages”, says Singh. While Spar’s thin margins limit its ability to shield shoppers from rising costs, he said Shoprite is likely to keep inflation below CPI to attract value-driven consumers. Woolworths will track CPI while leaning on brand strength and Pick n Pay and Spar will have to fight harder on efficiency and innovation to avoid losing further ground.

Business Day previously reported that more households with children went hungry in 2024 despite an overall improvement in the country’s food security. The 2025 South Africa food security index released by Shoprite in collaboration with Stellenbosch University economists rose to 56.5 from 44.9 in 2023, driven by better school feeding schemes, improved dietary diversity and easing food inflation.

Yet hunger among households with children climbed from 9% to 11.9%, and 61.7% of people still could not afford a healthy diet. UN children’s agency Unicef data shows 23% of children live in severe food poverty, while malnutrition remains a major cause of child deaths. Limpopo and Gauteng recorded the best food security outcomes, while rural resilience contrasted with growing urban hunger.

In the midst of all this, US giant Walmart has entered the fray, promising to ease the pressure on constrained consumers with an “everyday low prices” strategy that is yet to be tested.