Harare –Choppies Supermarkets’ new markets in Zambia,
Kenya and Tanzania are battling to make a significant revenue contribution and
will likely be a drag on the company, which has made inroads in Zimbabwe and
South Africa despite slow growth in its Botswana home market, analysts say.
SA retail giant Shoprite and Pick n Pay have also been
expanding their presence in the rest of Africa region to enhance growth in
light of competition and looming market saturation back home.
But they have been cautioned that they need well thought
out strategies such as partnerships (the case for Pick n Pay in Zimbabwe) as
well as resilience and adaptability to new market challenges.
The Botswana retail chain which is seeking to entrench
its foothold in Africa, intends to spend as much as $55 million on an expansion
drive. However, its foray into Zambia, Kenya and Tanzania is struggling to make
a mark on revenue generation, analysts said on Wednesday.
Read also: Despite slump, Choppies plans new stores
Choppies reported its interim financials on Tuesday
reflecting revenue growth of 34 percent on a year-on-year basis, driven by
retail space expansion largely in South Africa. The budget retailer has about 83
stores in Botswana, around 68 in SA and 31 in Zimbabwe as well as 10 in Zambia,
one in Tanzania and nine in Kenya.
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