Johannesburg - SA's biggest food retailer, Pick 'n Pay, has unveiled a R110m, two-year plan which will see its brand changed and some 300 convenience food products introduced in its stores.
The move looks set to see Pick 'n Pay win back market share it has lost to rivals Shoprite, Spar and Woolworths. Despite this, however, Pick 'n Pay remains the market leader by far, with around 36% of the market.
Pick 'n Pay will be launching over 450 new and repackaged lines in its fresh-foods range, including 300 ready-to-eat (convenience) meals, over 80 fresh produce lines, and more than 50 new meat products. This should see the company entrench its position among more affluent customers, who fall into living standards measurement (LSM) categories eight to ten.
These products are set to hit the shelves in the lead-up to the festive trading period.
Following that, Pick 'n Pay will roll out a range of more than 50 organic products to complement its organics range, which in the last financial year grew some 60%, the company said in a statement. "These products will all be launched under the Pick 'n Pay brand, replacing the existing Choice and Foodhall brands. All these products will be phased into stores over the next six weeks.
SA's biggest private label, No Name, would also undergo brand enhancement, but will retain its name.
Brand change, new faces
The look of the Pick 'n Pay logo has been updated, and the first 30 corporate stores - all flagship or high-volume stores - and 25 franchise stores will be transformed with the new visual identity before February 2008. All stores are set to be completed during 2009. Staff uniforms are also being changed.
CEO Nick Badminton said that as part of Pick 'n Pay's reassessment of its strategy, which started in March, it consulted with 4 000 customers.
"This process, together with a detailed assessment of our store performance, has resulted in a renewed focus on improving our customers' shopping experience at Pick 'n Pay, particularly the quality and consistency of our fresh offer. This move is the first of many customers can expect to see over the coming 12 to 18 months.
"In assessing our brand change, we needed to be mindful of the fact that we provide over 22 000 stock-keeping units in our typical supermarkets and more than 40 000 in a hypermarket, while our stores cover a total of 1.4m square metres, equivalent to more than 250 rugby fields. We also generate about 30m till slips every month at Pick 'n Pay. We thus have a very clear idea of enormity of the task ahead of us."
Pick 'n Pay has also announced that retail heavyweights will be joining the company, two of whom have previously worked at Woolworths, which has developed a highly successful food business based on its emphasis on convenience and quality.
Steve Hoban, who is currently the director of global procurement at the world's largest retailer, Walmart, will join the company's trading team in early 2008. Malcolm Green, who previously headed up distribution for a Woolworths, will lead Pick 'n Pay's supply chain, a key development area in the company.
Cobus Barnard, the former head of franchising at Woolworths, will also join Pick 'n Pay "to further its convenience strategy".
Customer communication
Pick 'n Pay plans to increase its spending on electronic media "in a bid to increase and consolidate its reach, and changing the way in which it communicates to consumers to increase and entrench differentiation".
It will be launching a new customer magazine Fresh Living, "designed to talk directly to a broad cross section of Pick 'n Pay's customers". Further, a 64-page lifestyle catalogue promoting general merchandise sold in the 18 hypermarkets will be produced, with an initial print run of one million copies.
In a bid to improve customer service, Pick 'n Pay says it will aim to open another till until all tills are open should there be more than one person in front of a customer in a queue. Also, toll-free customer lines will be advertised in-store to aid delivery on this commitment.
To emphasise the importance of fresh food, Pick 'n Pay will also promise customers that if they find any expired product on any shelf in store, the customer will receive a fresh one for free.
- Fin24