Shoprite Holdings, South Africa’s largest grocery retailer, has announced plans to sell its operations in Ghana and Malawi, marking a significant step in its strategy to consolidate its African operations and prioritize its home market.
This decision follows a series of challenges in several African markets and reflects the company’s intent to streamline its focus on more profitable regions.
Economic Challenges
Shoprite, which has grown to become Africa’s leading food retailer with a presence in approximately 15 countries, has faced significant hurdles in its international operations.
Currency volatility, double-digit inflation, high import duties, and dollar-based rental costs have made markets like Angola and Nigeria less viable for the retailer.
These economic pressures have prompted Shoprite to reassess its footprint across the continent, leading to its decision to exit Ghana and Malawi.
Shutdown in African Countries
In Malawi, Shoprite signed an agreement on June 6 to dispose of five trading stores, pending approval from the Competition and Fair Trading Commission and the Reserve Bank of Malawi.
In Ghana, the company received a binding offer in June for seven trading stores and one warehouse, with the sale considered highly probable.
These moves follow Shoprite’s earlier exits from Nigeria, Kenya, the Democratic Republic of Congo, Uganda, and Madagascar, signaling a broader retreat from less profitable African markets.
Focusing on South African Market
The retailer’s decision comes as part of a broader strategy to restrict capital allocations to its supermarkets outside South Africa and redirect resources to bolster its dominance in its home market.
Shoprite has already seen success in South Africa, where it reported a 12% jump in annual sales for the 52 weeks ended June 28, 2024, driven by new store openings and double-digit sales growth across its store brands.
The company expects group sales from continuing operations to rise by 8.9% to 252.7 billion rand ($14 billion) for the 52 weeks ended June 29, 2025, with headline earnings per share projected to increase between 9.4% and 19.4% from a restated 11.85 rand in 2024.
Shoprite’s aggressive expansion in Africa had previously allowed it to surpass competitors like Pick n Pay and Walmart-owned Massmart, establishing it as a retail powerhouse on the continent.
However, the economic realities of operating in frontier markets have led to a strategic pivot.
The company’s focus on South Africa aligns with its efforts to capitalize on its strong market position and invest in initiatives like its Sixty60 on-demand delivery service, which has expanded to include discount stores to compete for low-income shoppers.
This article was edited with AI and reviewed by human editors
