Shoprite, Africa’s largest supermarket chain, is once again trimming its presence across the continent, this time announcing plans to exit both Ghana and Malawi.
The move marks a continued shift in strategy for the South African retail giant as it doubles down on its core market back home. Shoprite has been scaling back its African operations over the past few years, having already pulled out of countries like Nigeria, Kenya, Uganda, the DRC, and Madagascar.
The company confirmed that it has entered into a deal to sell five of its stores in Malawi. The agreement, signed on June 6, is still subject to regulatory approvals, including from Malawi’s Competition and Fair Trading Commission and the central bank.
In Ghana, Shoprite says it has received a binding offer for seven of its stores and a warehouse, making a sale all but certain.
Why the Retreat?
While Shoprite’s pan-African expansion once saw it surpass competitors like Pick n Pay and Massmart, the retail landscape beyond South Africa has proven volatile. Markets such as Angola and Nigeria brought challenges like unpredictable currency exchange rates, surging inflation, high import costs, and hefty dollar-based rents—all of which have eroded profitability.
As a result, the company has tightened its capital investment outside South Africa and focused instead on strengthening its home operations.
Financial Outlook Still Positive
Despite the exits, Shoprite appears optimistic about its future earnings. The company expects headline earnings per share from continuing operations to rise between 9.4% and 19.4% for the financial year ending June 29, 2025, compared to a restated 11.85 rand per share in 2024.
However, the news of the Ghana and Malawi sales did dampen investor sentiment, with Shoprite’s shares slipping 2.6% in early trading on Tuesday.
Shoprite’s gradual retreat from certain African markets underlines a tough reality: expanding across Africa is not without serious risks, no matter how large or established a brand might be. For now, the company appears content to consolidate, streamline, and thrive where the numbers and conditions make the most sense.
-Deeprows News
