Friday, October 30, 2020

Furniture Mart opens its first mega store

Furniture Mart, the titanic regional furniture shop listed on the Botswana Stock Exchange (BSE), pressed ahead with its planned growth strategy by opening its first mega shop, Home Corp in Gaborone last week.

The company, headed by one of the country’s wealthiest man, John Myhnard, pushed the number of it’s outlets within southern African region to close to 70.

The company has operations in Botswana, Namibia and the northern province of South Africa, where it is intending to launch an offensive market penetration against its peers.

“For too long, Botswana residents have been restricted by choice when it comes to home furnishing- but no longer!

“A fantastic new store called Home Corp now houses absolutely everything you need for your home- all under one roof,” The statement from the company said.

Home Corp is 2 400 square metres ÔÇô at the former Game City mall ÔÇö offering an array of treasure trove of furniture, home appliances, built in kitchens, blinds and curtains among others.

The Home Corp brand is expected to be replicated around the region with a view of changing the furniture shopping across the sub-continent.

“The geographical expansion of the group remains the growth story and the full benefits of it will flow through to the bottom-line in two years time,” a research note from the sponsoring broker, Stockbrokers Botswana said.

Under its new plan, the company is eyeing to increase its presence in the remote areas of South Africa, targeting the burgeoning low and middle class as the country is experiencing the credit retail boom.

The move is expected to compliment the profit margins in the mature markets of Botswana and Namibia, where it is already a dominant player.

“South Africa has seen a huge boom in credit retail in the past two years on the back of low interest rates and retail optimism,” the brokerage firm said, adding that “the quality of debtor’ book will be of paramount importance to the success of the South African expansion and, whilst current experience suggests that there is no cause for concern, the potential risk of increasing debts exists.”

Further, the company, which operates under Xtreme Discount, is expected to benefit from the larger South African population, which tops 40 million but it will face resistance from some of the already existing and Johannesburg Stock Exchange listed stores such as Ellerines and Joshua Doore, which have close to 200 outlets in that country alone.

“Management point out that the growth in the aggregate wealth of the lower and middle income earners, the credit pie in South Africa, has got larger, allowing room for growth, particularly for niche operator,” the research note said.

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