Choppies to stay put in regional market

Boitshepo Majube | Friday January 17, 2014 16:46

 

Choppies chief executive officer Ramachandran Ottappath told Business Week that the retailer sees no need to expand further in Africa, as the region has plenty of opportunities for the retailer.

There is massive growth potential in the region for Choppies at the moment and we are focused on exploiting those opportunities, he said.

Choppies is currently expanding in Zimbabwe. At the moment we have 13 stores and we are hoping to open 10 more this year, he said, further stating that it had a distribution centre in Bulawayo, Zimbabwe. However, Ottappath explained that it took nine to 10 months for a business plan to translate into business.

SADC countries in the radar of the retailer are Zambia and Tanzania.  Tanzania is a big market, it provides huge potential for Choppies, he said.  Choppies has in recent years also built a significant presence in the South African market. The South African expansion has initially focused on semi-urban communities in the North West, Northern, and Limpopo provinces.

In 2012, the company opened a large distribution centre in Rustenburg, which it uses to service its current South African network of 23 supermarkets.

Ottappath said over time, Choppies expects to grow the South African business to at least 80 supermarkets, representing about 40% of projected revenue.

This is one market that we would like to grow and make a huge impact, as it is one of the leading economies in Africa, he said.

He said as the retailer grows, it also increases much needed employment opportunities, both in Botswana and countries it operates in. Currently Choppies employs more than 10,000 people in Botswana, South Africa and Zimbabwe. Ottappath said as long as the retailer makes good profits, they would use the funds generated for expansion.

If it is necessary for Choppies to sell shares again, we will do so in order to grow the retailer, he said. Recently Standard Chartered Private Equity announced that it had acquired 13% of the company's shares.