Shoprite is a fast-moving consumer goods retail company in Africa operating various

hypermarkets, supermarkets, stores, and outlets. Shoprite retails various products such as

Clothing, Food Items, Cosmetics, Household appliances, Liquor, general merchandise, and home

entertainment systems. The company operates stores under various brand names such as

Shoprite, Usave, OK Foods, Sentra, Megasave, OK Grocer, Hungry Lion, Checkers, K'nect,

Checkers Hyper, Shoprite Hyper, OK Furniture, OK Power Express, House & Home, LiquorShop

Checkers, LiquorShop Shoprite, MedRite, TransPharm, OK Franchise, and Computickets Travel.

Shoprite is headquartered in Western Cape, South Africa.

The company through its subsidiaries operates wholesale and retail stores to sell fresh produce,

furniture, household goods, small appliances, pharmaceuticals and financial services. It also

provides logistics, ticketing, hospitality, franchise, and money market services. The company has

2,934 store outlets in 15 countries of which 1,957 in South Africa across Africa and Indian Oceans

Island, 19,398 suppliers, 30 distribution centers with a network of 837 trucks and 1,211 fleet

trailers. The company operates through four reputable segments: Supermarkets RSA,

Supermarkets Non-RSA, Furniture and other operating segments:

Furniture

This segment involves the selling of range of furniture, loose carpeting, soft furnishings,

appliances, bedding, floor covering, home entertainment and electrical appliances products at

competitive prices, on credit or cash. Major brands include OK Furniture, OK Power Express, and

House & Home brands.

Other operating segments

This segment consists of franchise operations and retail and wholesale of pharmaceutical

products, LiquorShop and Computicket in South Africa and outside of South Africa. Major brands

include Liquorshop Checkers, LiquorShop Shoprite, MediRite pharmacy, Transpharm, OK

Franchise, OK MiniMark & OK Express, CFS Checkers Food Services, and Computicket travel.

Supermarkets Non-RSA

This segment includes supermarket operations across 14 countries in the rest of Africa and Indian

Ocean Islands to sell groceries, household products, home appliances, garden and pool care,

home improvement, homeware, pet accessories, baby products, toys, stationery, and specialty

lifestyle ranges of cheese, meat, coffee and wine. Major brand include Checkers, Shoprite,

USave, Hungry Lion and Checkers Hyper brands.

Supermarkets RSA

This segment consists of supermarket operations in South Africa selling groceries, household

products, home appliances, garden and pool care, home improvement, home ware, pet

accessories, baby products, toys, stationery, and specialty lifestyle ranges of cheese, meat,

coffee and wine. Major brand include Checkers, Shoprite, USave, and Checkers Hyper brands.

Intends to invest in the expansion of Hyperstores.

Key contributors to profitability and growth of the business

Shoprite has significant operational and distribution infrastructure that enables it to move its

products efficiently. As of 2019, the company operated 2,934 stores across 15 African countries

such as Angola, Botswana, DRC Ghana, Lesotho, Madagascar, Malawi, Mauritius, Mozambique,

Namibia, Nigeria, Swaziland, Uganda, and Zaambia. It had 665 Shoprite, 424 Usave, 228

Checkers, and 37 Checkers Hyper brand Outlets. Under Furniture, Shoprite operates OK

Furniture and House & Home brands catering middle income and high income groups

respectively. In addition, Shoprite has experienced improved liquidity levels due to the increasing

ease in funding which enables the company conduct its day to day operations and ultimately

improves its ability to capture growth opportunities in the market. The company's current ratio was

1.2 at the end of 2019 when compared to a current ratio of 1.0 at the end of 2018. Furthermore,

the company reported revenue of R150 million in 2019 as compared revenue of R145 million in

2018, representing an annual growth of 3.6%. Revenue growth was due to increase in sales fromSupermarkets RSA that resulted from enhanced on-shelf availability and implementation of

enterprise-wide IT retail system across its supermarkets on time and within budget.

Target market

Shoprite targets low-income to middle-income consumers (LSM 4 - 7) across South Africa by

offering them quality retail offerings at competitive rates.

Challenges of the business

Although Shoprite has its presence in other African countries, it depends on its domestic market,

South Africa, for a majority of its revenues. In 2018, it generated 83.9% of its revenues from its

domestic market. Dependence on South Africa could affect the company's operational and

financial performance and increases its business risks by exposing it to the economic and

geopolitical risks associated with the country, which could affect the demand for its products or

disrupt the supply chain and restrict its market share and growth opportunities in the future. This

also hinders the company's international growth plans.

The company operates in a highly competitive retail industry. Shoprite faces intense competition

from both domestic and international companies in the retail market. Its major competitors include

John Lewis Partnership Plc, Kingdom Meikles Africa Limited, Massmart Holdings Limited, Pick n

Pay Holdings Ltd, The SPAR Group Limited, Steinhoff International Holdings NV, Taste Holdings

Limited and Woolworths Holdings Limited.

Conclusion

Being successful in any area requires hard work and a continual commitment to excellence. In

this competitive industry, changing needs and environments require Shoprite to stay in touch with

both the environment and the consumers whose needs they wish to satisfy to continue their

success into the future.

Investors at Shoprite have grown weary of how the external market is affecting business

performance following the emergence of COVID-19. The market has been filled with job cuts,

reduction in the salaries of employees, lower profitability and higher levels of price sensitivity

amongst consumers. Considering this, you come across a newspaper article in BusinessTech

that explains that forces in the external environment are drivers of these current developments

in the external market. Also, that Shoprite needs to be aware of the implications of these

forces, specifically how the firm can meet its financial obligations and protect its market share.

Question

I need help please with Identifying, one trend in the technological environment, one trend

in the economic environment, one trend in the legal environment and one trend

in the social/cultural environment that impact Shoprite. For each trend, please recommend a marketing specific strategies that Shoprite can consider to ensure continued success in the grocery retail market in relation to the different environments