Pick n Pay has launched a pilot program partnering with spaza shops in townships to offer the informal market a convenient service.
The supermarket has worked with its suppliers to upgrade the spazas with new refrigeration and IT systems.
CapeTalk's Kieno Kammies spoke to Richard Van Rensburg, Deputy CEO at Pick n Pay about the initiative. It has already started being piloted in Gauteng province and will now be launching in the Western Cape.
The problem with running a small convenient store in the neigbourhood is that you need a very good supply chain because you have a small store and you needing to provide a wide range of products close to where the customer lives.— Richard Van Rensburg, Deputy CEO Pick n Pay
That means you need to deliver every product that you sell everyday to that store in a consistent way to make sure the offer is available for the customer. And usually spaza shop owners do not have that kind of a supply chain.— Richard Van Rensburg, Deputy CEO Pick n Pay
Van Rensburg says they have developed a good relationship with spaza shop owners, giving them full buying power. He says the products sold in their stores are in the same price range as the ones found in any Pick n Pay stores, sometimes even cheaper.
The system that is going to be used in these spaza outlets is similar to the systems used in a new store opening in Constantia, says van Rensburg.
People don't always realise that the informal retail sector is huge ... and is incredibly competitive.— Richard Van Rensburg, Deputy CEO at Pick n Pay
What we bring to the party other than price is that we've got a cold chain and we've got advanced IT system that allows proper forecasting for the owners— Richard Van Rensburg, Deputy CEO at Pick n Pay
To hear the rest of the interview, listen below: