RESEARCHING A STOCK FROM TOP TO BOTTOM
//Shoprite Addition
//Shoprite Addition
To make things easy, we are breaking this thread up into 3 separate parts:
1) Understanding the business.
2) Economic moat.
3) Financials.
4) Leadership and management.
1) Understanding the business.
2) Economic moat.
3) Financials.
4) Leadership and management.
1) Understanding the business.
Shoprites core business is in food retailing, complemented by furniture, pharmaceuticals, hospitality, ticketing, and cellular services.
Shoprites core business is in food retailing, complemented by furniture, pharmaceuticals, hospitality, ticketing, and cellular services.
Let's take a look at some of their brands:
Shoprite
U$ave
Checkers
Checkers hyper
The entire OK franchise division
House & Home
Liquor Shop
Checkers sixty60
K'nect
Medirite Pharmacy
These are brands that we use every day.
Shoprite
U$ave
Checkers
Checkers hyper
The entire OK franchise division
House & Home
Liquor Shop
Checkers sixty60
K'nect
Medirite Pharmacy
These are brands that we use every day.
Shoprite store locations (As of 2021)
Shoprite has over 2 400 stores throughout Africa. South African stores account for more than 2 200 of those stores. Namibia has 95, Angola has 36, Botswana has 33, Zambia has 51, DRC has 3 and the rest of Africa has 108 combined.
Shoprite has over 2 400 stores throughout Africa. South African stores account for more than 2 200 of those stores. Namibia has 95, Angola has 36, Botswana has 33, Zambia has 51, DRC has 3 and the rest of Africa has 108 combined.
Shoprite store count
Shoprite has a diverse selection of stores. More specifically, they have 527 Shoprite stores, 339 LiquorShops (Shoprite), 235 Checkers, and much more.
Shoprite has a diverse selection of stores. More specifically, they have 527 Shoprite stores, 339 LiquorShops (Shoprite), 235 Checkers, and much more.
More on Shoprite
Shoprite is SA's largest fast-moving consumer goods retailer. Its purpose is to be Africa's most affordable, accessible, and innovative retailer. Shoprite has a huge focus on customers. This means that SHP is CONTINUOUSLY working to meet customer demands.
Shoprite is SA's largest fast-moving consumer goods retailer. Its purpose is to be Africa's most affordable, accessible, and innovative retailer. Shoprite has a huge focus on customers. This means that SHP is CONTINUOUSLY working to meet customer demands.
The thing about customers is that they are never satisfied.
Shoprite is positioned as a leader in the industry and on the African continent. This is evident in infrastructure, systems, and intellectual property and is reflected in the way customers respond to offerings.
Shoprite is positioned as a leader in the industry and on the African continent. This is evident in infrastructure, systems, and intellectual property and is reflected in the way customers respond to offerings.
Innovation
Shoprite is positioned as a leader in the industry and on the African continent. This is evident in infrastructure, systems, and intellectual property and is reflected in the way customers respond to offerings.
Shoprite is positioned as a leader in the industry and on the African continent. This is evident in infrastructure, systems, and intellectual property and is reflected in the way customers respond to offerings.
Increased competition provides more product and shopping options to customers. This drives innovation in systems and support functions to deliver on high customer expectations. Let's look at how Shoprite responded👇
Shoprite responded by:
•Expanding the scope of their customer offerings to include more digital solutions.
•Leveraged Checkers sixty60 further and continued to diversify revenue streams.
•Extended digital ecosystems by improving virtual vouchers and coupons.
•Expanding the scope of their customer offerings to include more digital solutions.
•Leveraged Checkers sixty60 further and continued to diversify revenue streams.
•Extended digital ecosystems by improving virtual vouchers and coupons.
What is Shoprites goal?
Simply put, Shoprite is in the business of sustaining lives through the products they sell.
Their objective is simple and clear:
They want South Africans to live better lives because of being Shoprite customers.
Simply put, Shoprite is in the business of sustaining lives through the products they sell.
Their objective is simple and clear:
They want South Africans to live better lives because of being Shoprite customers.
Economic engine
If we assume that Shoprite works on a profit per store basis, we can do the math. (As of 2021)
Profit for the year= R4 859 000 000
Total Stores= 2400
Profit per store= R2 024 583
The more stores, the more profit.
If we assume that Shoprite works on a profit per store basis, we can do the math. (As of 2021)
Profit for the year= R4 859 000 000
Total Stores= 2400
Profit per store= R2 024 583
The more stores, the more profit.
Understanding the economic moat
We will look at the following moats:
•Size
•Economies of Scale advantage
•First Mover advantage
We will look at the following moats:
•Size
•Economies of Scale advantage
•First Mover advantage
Size
Shoprite's market cap is considerably higher than other competitors.
Shoprite- R135.23 billion
Clicks- R72.3 billion
Spar- R31 billion
Pick n pay- R22.92 billion
Size can most definitely be a moat.
Shoprite's market cap is considerably higher than other competitors.
Shoprite- R135.23 billion
Clicks- R72.3 billion
Spar- R31 billion
Pick n pay- R22.92 billion
Size can most definitely be a moat.
Economies of Scale Advantage
Shoprite's extensive footprint and the large volume of goods moving through their stores allow them to source goods cheaper than their competition.
Shoprite's extensive footprint and the large volume of goods moving through their stores allow them to source goods cheaper than their competition.
First Mover Advantage
Shoprite has been expanding in Africa for ~20 years. It has not always been easy for them.They have dealt with poor infrastructure, and regulatory requirements and sometimes even had to build malls and shops for their stores. This creates a barrier to entry
Shoprite has been expanding in Africa for ~20 years. It has not always been easy for them.They have dealt with poor infrastructure, and regulatory requirements and sometimes even had to build malls and shops for their stores. This creates a barrier to entry
Checkers sixty60 is an example of this.
It was the first of its kind in SA and came at the best time. Checkers sixty60 flourished and took off during mandatory lockdown.
It was the first of its kind in SA and came at the best time. Checkers sixty60 flourished and took off during mandatory lockdown.
3) Financials.
4) Leadership and Management
A team of great people can make or break a business.
Warren Buffet once purchased Wells Fargo shares simply because of the management team that was involved. Wells Fargo went on to outperform the market for 15 years.
A team of great people can make or break a business.
Warren Buffet once purchased Wells Fargo shares simply because of the management team that was involved. Wells Fargo went on to outperform the market for 15 years.
Pieter Engelbrecht (CEO)
Pieter Engelbrecht served as COO and Alternate Director of SHP for 11 years.
Since his appointment as CEO, he has led Shoprite to become SA's largest food retailer, low-price leader, and SA's largest private sector employer.
Pieter Engelbrecht served as COO and Alternate Director of SHP for 11 years.
Since his appointment as CEO, he has led Shoprite to become SA's largest food retailer, low-price leader, and SA's largest private sector employer.
He has a huge focus on driving down costs (which they do very well) and rapid expansion of the business.
He has played a vital role in the establishment of Shoprites position as the Number One retailer in Africa.
He has played a vital role in the establishment of Shoprites position as the Number One retailer in Africa.
Prior to being named CEO, Pieter Engelbrecht was appointed as Chief of Operations in 2005 and was personal assistant to the then CEO.
Anton De Bruyn (CFO)
Anton De Bruyn joined Shoprite Checkers in 2000 and was appointed as CFO in 2018.
He served his articles at PwC and worked briefly at Harwill investments and Henderson investments.
He completed his studies at Stellenbosch University and Unisa.
Anton De Bruyn joined Shoprite Checkers in 2000 and was appointed as CFO in 2018.
He served his articles at PwC and worked briefly at Harwill investments and Henderson investments.
He completed his studies at Stellenbosch University and Unisa.
Anton De Bruyn has more than 15 years of experience within the Shoprite Group and fits in his role as deputy General Manager of Group Finance.
Ram Harisunker (Executive Director)
Ram Harisunker has been working in the industry for a mind-warping 53 years.
53 years!
There is no doubt that he knows the industry like the back of his hand. He is responsible for operations in Eswatini and international sourcing.
Ram Harisunker has been working in the industry for a mind-warping 53 years.
53 years!
There is no doubt that he knows the industry like the back of his hand. He is responsible for operations in Eswatini and international sourcing.
He is currently the Divisional Manager at Shoprite of Kwazulu-Natal and Indian Ocean Islands operations.
He has also served as General Manager of Mozambique, Indian Ocean Islands & India. He has been an Executive Director of Shoprite since November 2002.
He has also served as General Manager of Mozambique, Indian Ocean Islands & India. He has been an Executive Director of Shoprite since November 2002.
This thread was written by @EasyEquities and can be found on the #FinMeUp app.
Be sure to check out the original article here👇
finmeup.app
Be sure to check out the original article here👇
finmeup.app
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