Woolworths buys franchises in Ghana, Others to tap into growing African affluence

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Ian+Moir+XXX+high+resWOOLWORTHS said on Tuesday that it had signed agreements to purchase its franchise businesses in Botswana, Namibia, Swaziland and Ghana.

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This marks the end of franchise stores in African countries for the retailer.

Woolworths, like other retailers, is expanding its footprint on the continent as urbanisation and rising affluence fuel a boom in fast-growing cities, with a middle class clamouring for high-quality goods.

Investments in other African countries in future will either be focused on company stores or joint ventures with Woolworths.

The group has a presence in 12 African countries, excluding South Africa.

Woolworths CEO Ian Moir said the transaction gave the group a business of scale, lifted profitability of its African operations and positioned it for growth in these countries. The 33 stores in the countries are predominantly clothing and general merchandise but Botswana has a significant food business.

The addition of the stores brings the combined retail turnover in African countries close to R1bn a year.

The franchise stores were previously managed by Ish Handa, who will become a nonexecutive director of Woolworths in both Botswana and Namibia on conclusion of the deal, which is subject to competition commission approval in Namibia, Botswana and Swaziland. It plans to have about 82 stores in Africa outside of its home market by 2016.

Woolworths group retail operations and international director Paula Disberry this week said that the economic and socio-demographic trends in Africa were working in favour of modern retail and Woolworths’ positioning.

“The growth in sub-Saharan Africa has been over 5% for the last three years,” she said at the World Retail Congress Africa in Sandton. The group has launched its WRewards loyalty programme to the Zambian and Mauritian markets, where 45% of its sales can now be tracked.

“We have introduced store cards and a credit offering in Kenya and we will roll out our store card to all our African countries,” Ms Disberry said.

Babatunde Akinsola
Babatunde Akinsolahttps://naija247news.com
Babatunde Akinsola is aNaija247news' Southwest editor. He's based in Lagos and writes on the Yoruba Nation political issues, news and investigative reports

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