The distribution network in South Africa

Evolution of the Sector: One of Africa’s largest and most affluent markets, South Africa has a well-developed retail sector, including a number of major domestic players. The emergence of supermarkets and hypermarkets, which sell large quantities of nearly all consumer goods on a self-serve basis, has resulted in major developments in the distribution sector in South Africa; however, traditional grocery retailers are still widespread.
According to Stats SA, retail sales reached 1.166 trillion rands in 2021. The sector recorded a positive growth performance – spending on retail increased by 6.4% in 2021 compared to the previous year in value terms, in the context of economic recovery. General dealers are responsible for 42.7% of sales, the second largest contributor was stores specialising in clothing and textiles (18.2%) and finally stores specialising in hardware, paint and glass (8.3%) (Stats SA, February 2022). Over one-third (38.7%) of the 1 million individuals working in retail were employed in non-specialised stores, although recording the lowest salaries in the sector. According to latest data available by USDA, the retail market growth in South Africa is mostly driven by discounters (7% growth in 2020) and hypermarkets (7%). The other formats of stores are still growing, but at a slower pace : supermarkets (5%) and convenience stores (3%). Traditional grocery retailers’ sales decreased by -15%.
Market share: Although the black middle class with considerable disposable income has expanded in recent years in South Africa, major income disparities persist. The major share of South Africa's consumer market is divided into two parts: a market for those with high spending power (a majority of whites and newly affluent blacks), and a market for those with very limited spending power (the majority of blacks).
The majority of retail sales takes place in shopping centres, groups of small shops, department stores (Stuttafords, Edgars, Woolworths), supermarkets (Checkers, Pick' n Pay) and hypermarkets (Makro). Traditional shops remain active, in particular outside of major cities, but do not represent a big share of the market and are mainly used by poorer segments of the population.
The main retailers in South Africa are Shoprite Holdings, Pick’ n Pay Retailers, Spar Group, Massmart (Walmart-owned), and Woolworths Holdings, together accounting for about 80% of all retail sales (USDA).
Retail Sector Organisations: Fuel Retailers' Association
South African Council of Shopping Centres
Consumer Goods Council of South Africa

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