Shoprite is a household brand name in South Africa and also in other parts of Africa. The Shoprite Group’s humble beginnins date back to the late 1970S with the acquisition of eight small grocery stores in the Western Cape. The group has focused over the past few decades on acquisitions of other grocers such as Checkers (1991), OK Bazzars (1997), and Metcash Trading’s franchise division (2011). What makes the Shoprite Group unique is the diversification of its assets, which is clear in the acquisition of Computicket (2005) and the building of the brands OK Furniture and Power Express, House & Home, MediRite Pharmacy, TransPharm and Hungry Lion. This shows that, in addition to ‘normal’ groceries, Shoprite also moved into the furniture, household appliances, pharmaceutical and fast-food industries. The strategy allowed Shoprite to keep expanding its market and providing various required services to the lower- and middle-income local communities. The supply chain methodology that Shoprite has installedinto its business is what makes this retailer special and extraordinary.

The Shoprite Group has designed its supply chain model based on the expectations, needs and social background of its target market. It seems the focus of the Shoprite supply chain is saving more money. Therefore, through their process of upgrading their existing supply chain operations in order to decrease operational costs Shoprite is in a position to provide lower-priced consumer goods to its customers. The Shoprite supply chain has been deisgned to align with other major international retailers and is now also seen as the leader in the African retail supply chain industry. This internationally recognised supply chain infrastructure allows Shoprite to manage more effectively and efficiently its supply chain across the 15 African countries its services. This allows for quality to be guaranteed throughout the supply chain at a reduced cost for the consumer.

Shoprite has invested a lot in its transportation of quality products through its fully-owned fleet. The fleet operats on a 24-hour, seven days-a week programme, which ensures that products are delivered to over 2000 retail outlets across the African continent. Since Shoprite has its own fleet, route planning and scheduling is completed in a specific way through the use of sophisticated software that allows for optimisation of deliveries, reducing the number of vehicles on the road, minimising their carbon footprint and saving the consumer and the group money. Furthermore, Shoprite has enhanced its supply chain by working closely with its trading partners, which are mostly new, upcoming businesses, and to save costs, they deliver directly to the retail outlets within their region. Building and maintaining a stable relationship with the trade partners in such a complex supply chain is a challenge, but if one gets it right, like Shoprite has, then a supply chain can be efficient and effective. Shoprite has furthermore implemented reversed logistics initiatives wihin the Group. This allows Shoprite to decrease its level of impact on its environment, and also to create opportunities for more sustainable thinking and development to take place within both the business and the communities it serves.

 

You are tasked to read the case study and relate or apply the customer service function within the Shoprite supply chain 40 marks Note: your application point answer must cover the following aspects (Chapter 1 slide 24 & 25): 1) Customer on both sides of the Shoprite supply chain, where one procures the raw materials and the other consumes or uses the final products (10) 2) Building good relationships with both sides of the Shoprite supply chain (10) 3) Management of pre-transactional activities within the Shoprite supply chain (10) 4) Managing the post-transactional activities within the Shoprite supply chain (10)