Online sales growth accelerates at Pick n Pay

Pick n Pay, which is facing significant headwinds, can count at least one area of its business that’s still performing exceptionally well: online.

The retail group said on Wednesday that online sales in the half-year ended 27 August 2023 jumped by 76.3% year on year (up from 72% in the 2023 financial year), driven by a doubling in its on-demand platforms, asap! and Pick n Pay groceries on Takealot’s Mr D app.

“Online execution continues to be ramped up, with 25 000 products now available on asap! and 500 stores (including supermarkets and liquor stores) now on the platform,” it said.

“The customer’s delivery experience continues to be enhanced, with a 36% year-on-year reduction in order preparation time and a 20% improvement in delivery time.”

Pick n Pay, which is up against Shoprite’s popular Checkers Sixty60 service, said it relaunched the asap! app this month, adding artificial intelligence-driven search to the software.

“The group is driving non-grocery online sales via Pick n Pay Clothing’s online platform and Pick n Pay Home,” it added.

It also recently relaunched its Smart Shopper loyalty programme to make it “simpler and more rewarding for customers”. This will include a “totally new app” that will “enable more seamless offers and communications, and make it even easier for customers to collect and spend points”.

Pick n Pay performance

In the latest 26-week reporting period, Pick n Pay reported group turnover of R54.1-billion, up 5.4% year on year. Trading profit, however, plunged by 97.5% to just R31.8-million, hurt in part by underperformance in the core supermarkets business. The group reported a headline loss per share of 137.24c from positive earnings of 97.73c a year ago, but emphasised this was impacted by abnormal costs associated with a restructuring. It has elected not to pay a dividend as a result of the poor operating performance.

“The group delivered a disappointing result in a period heavily impacted by load shedding and increased competitive intensity,” it said. “R396-million spent on diesel to run generators and keep stores open not only impacted expense growth, but also constrained Pick n Pay’s ability to respond to increased promotional activity in the market.”

Read: Pick n Pay is gearing up for permanent load shedding

On the back of the poor performance, Pick n Pay recently replaced its CEO, bringing back former boss Sean Summers. The group described Summers as a “Pick n Pay veteran who previously led the group through a highly successful period”.  – © 2023 NewsCentral Media

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