News24 | US giant Walmart to open first stores in SA before end of the year

A Walmart store in San Leandro, California.

• US retail giant Walmart will open its first namesake branded stores later this year, selling fresh groceries, essential household goods, apparel and technology.
• The group did not disclose how many stores it would be opening, but indicated it would use a variety of locally-sourced products.
• The official opening dates of the new stores will be announced in October.
• For more financial news, go to News24 Business.

US retail giant Walmart will open its first namesake branded stores later this year, selling fresh groceries, essential household goods, apparel, and technology.

The Arkansas-headquartered retailer did not disclose how many stores it would be opening, but indicated it would use a variety of locally-sourced products.

The announcement follows Walmart’s first growth summit held in SA in April, which featured suppliers from 12 African countries and led to the recruitment of small and medium-sized suppliers in SA and the rest of the continent.

Kath McLay, Walmart International President and CEO, said in a statement that Walmart’s South African stores would “offer a wide range of merchandise, including fresh groceries, household essentials, apparel and technology”.

“Walmart also will offer a variety of locally sourced products. By partnering with South African suppliers and entrepreneurs, Walmart will bring its signature ”every day low prices” and global standards to the market, while celebrating the country’s rich culture.“

Walmart said sites were already in development, with the new stores set to open before the end of the year, with official opening dates to be announced in October.

It said customers could “also look forward to digital capabilities to enhance their shopping journey”.

Miles van Rensburg, President and CEO of Massmart, Walmart’s locally owned retail operation, said the group was “thrilled to begin this journey introducing the iconic Walmart brand to South African associates, customers and communities”.

Massmart’s other brands, such as Game, Builders, and Makro, will continue, with Walmart being another brand added to the local portfolio.

Sasfin Wealth senior equity analyst Alec Abraham said this move by Walmart was “probably inevitable”, adding that the US giant was looking to “leverage off the Walmart brand and possibly gain off that” locally.

He said recent entries into SA from international brands, such as Amazon, had seen them coming in and adopting their own branding.

Abraham believed Walmart hoped to “gain a bit of traction due to the pool of brand equity it has”.

“I think, like any new entrant, there will be an initial excitement with people wanting to go and see what the offering is like. Then it will be up to Walmart to see if they can sustain that initial footfall, once everyone has checked out what they are offering.”

Anchor investment analyst Steph Erasmus said more competition entering the South African market was “great for the consumer”, especially a “very big brand like Walmart”.

He said it remained to be seen, though, how the US retailer would expand these Walmart-branded stores. He pointed out that in the group’s initial entry into SA about 12 years ago, it had not been successful in taking market share from the likes of Shoprite.

“Are they (Walmart) going to go flat out and try and take market share, or is it going to just be a little foray into South Africa? I am not sure how they are going to play this.”