While the review is still at its early stage, South African multinational retail group Woolworths has finally bowed to pressure from consumers and will slash its retail prices before end of this year. The group, which operates 22 stores across Botswana, confirmed in a statement released to the market this week that it has put in place plans to offer competitive prices to local consumers by reviewing its retail prices of food and clothing.
The announcement also follows the taking over of the management of Woolworths Stores from previous franchisees in Botswana after which it undertook comprehensive review of its operational efficiencies as well as pricing models. Paula Disberry, Group Director of Retail Operations at Woolworths, explains: “We have listened to our customers and reviewed the pricing model in Botswana. By improving supply chain efficiencies and changing our business model from franchise to corporate stores, we have secured savings which we will pass on to our customers. The savings will be in the form of reduced food and clothing prices from mid June 2014.”
Woolworths is also reviewing its promotional strategy. Disberry said it has always been their intention to offer customers in Botswana the same promotions that they run in South Africa. These promotions will be phased in over the next few months as Woolworths upgrade its IT systems to accommodate them.
Sunday Standard understands that plans are also afoot to launch the full Woolworths Rewards program in Botswana early next year. As a result, customers who have a Woolworth’s card can look forward to additional savings on hundreds of items in store by January 2015. A random survey across retail stores which also originate in South Africa shows that, unlike its competitors, Woolworths marks up on the Rand value, usually removing the evidence in the process. As a result, as the South African Rand weakens and the Pula strengthens local consumers find the gap in the cost of goods between South Africa and Botswana in Woolworths growing, which affects their purchasing power. Disberry said the strategy is to align the Woolworths offer in Botswana with South Africa and become the retail destination of choice for local consumers.
“Stores in Botswana form a significant part of our African footprint and we are very excited about the future,” she said.