Ongoing strike continues to have impact after hurting December trade - Dis-Chem
JOHANNESBURG - Health and beauty products retailer Dis-Chem said on Thursday it recorded revenue growth of 10.7 percent to R9.4 billion during the 22 weeks to February 2 compared with the same period last year, but that an ongoing strike was affecting it.
"As was the case in the previous calendar year we continue to see constrained consumers searching for value offerings," chief executive Ivan Saltzman said. "Our everyday low price strategy and the availability of choice for our customers enabled us to continue to gain market share in all of our core categories."
Dis-Chem said it saw the biggest market share gains for the financial year in October and November on the back of its successful 'MicroPopz!' promotional campaign which saw 500,000 new customers walking through its doors.
An ongoing strike however heavily impacted December trade and continued to affect the group, resulting in an extremely tough trading month with retail revenue growth at 6.2 percent and retail comparable store revenue at -2.5 percent, well below expectations.
Dis-Chem workers affiliated to the National Union of Public Service and Allied Workers (Nupsaw) went on strike in November, demanding a minimum wage of R12,500 across the board, an annual increase of 12.5 percent guaranteed for the next three years for those earning above that amount and a guaranteed annual bonus.
"Although contingency plans were in place to ensure minimal disruption at our retail stores we experienced lost opportunity sales in December primarily due to stock supply challenges," the retailer said.
"This was further supported by the fact that we reported our lowest market share gains of the financial year in the December month."
But as challenging as these last three months had been, with operations in three of its four distribution centres being impacted, Dis-Chem said its stance on the industrial action was that it would not negotiate with any union not representative of its workforce.
Dis-Chem has been in a dispute with Nupsaw over its recognition.
- African News Agency (ANA), Editing by Stella Mapenzauswa