Botswana market emerged out as the best contributor to home grown retail giant Choppies’ revenues with 80% of the 2020 gains attributed to the country.
The Botswana Stock Exchange-listed company revealed in its 2020 annual report that it has strong leadership position in Botswana and is an active participant in economy as a leading employer.
“The saturated market has led to more competition and Choppies still has a room for more revenue by adding more value to customers that have relatively high purchasing power and their consumption habits are slowly becoming more sophisticated, “said the delighted Group.
The group says as 80% of revenue is attributed to Botswana, which makes it difficult to decentralise certain activities and investments from the central office based in the capital Gaborone.
To that end, many improvements could be achieved by robust leveraging on other countries’ comparative advantages such as production of certain goods with high a quality but at a lower cost.
Choppies Group CEO Ramachandran Ottapattu has reckoned that trade in Botswana market is becoming overpopulated and therefore the much diversified commercial entity has felt the effects.
According to Ottapathu, they have focused on becoming a leading company with an evolving value proposition comprising higher margin goods and services tested for innovation.
“This year we have furthered expansion in the territory with three new stores, and the addition of new value-added products, especially in grocery and expansion of fresh produce and meat. To increase brand loyalty, we are optimising our store formats to suit needs of different population groups by increasing revenue per square metre,” he said.
On the operational review, Ottapattu noted that financial year 2020 was undoubtedly the most challenging ever in his career with the company emerging from several issues that came forth.
“The year started with uncertainity looming around the Board battle culminating in the EGM in 2019. The issues raised have now been resolved and settled on amicable terms,” he buttressed.
Also, he said the long process of selling the South African operations came to an end when they have found a buyer in November 2019 and was later on concluded at the end of February 2020.
The Group operations in Mozambique were closed down during September 2019 followed by the closure of East African based operations in Kenya and Tanzania during March 2020 respectively.
Ottapathu said Covid-19 had an impact on all aspects of business model and was to some extent more resilient to the effects of the pandemic.
Zambia market contributed 11 percent of revenue, Zimbabwe 8 percent and Namibia 3 percent. The Group said Zimbabwe is facing economic crisis and is worsened also by Covid-19 pandemic.
Choppies entered Zimbabwean mark through acquisition of existing stores from Spar network. At that time the market looked very promising but the situation changed very drastically due to political and economic instability that in turn affected Choppies badly, according to the annual report.