Spar opens first forecourt store

Posted On Wednesday, 14 August 2013 12:29 Published by Commercial Property News
Rate this item
(0 votes)

Listed retailer Spar Group has joined the foray into the forecourt stores business with the opening of its first Spar Express store in Germiston on Wednesday.

The forecourt retail market has become increasingly competitive, and while Spar’s debut is seen as positive for the group, analysts do not expect it to be “a game changer” for the retailer.

Through a partnership with service station operator Shell, Spar is testing the waters of the forecourt business with the roll-out of about three or four Spar Express stores in Gauteng over about nine months.

This is according to Spar group business development manager Bill Brown, who said on Tuesday the partnership with Shell — which mirrors similar Shell-Spar agreements in offshore countries such as Austria and Germany — would first "test the water in this market".

Should the venture prove successful, Spar Express stores would be rolled out further, Mr Brown said.

Spar joins other major retailers in the forecourt market, including Pick n Pay, Woolworths and Fruit & Veg City, as well as service station operators with their own retail offerings such as Sasol Delight! and Total’s Bonjour.

In April 2012, Pick n Pay announced the roll-out of Pick n Pay Express stores at BP service stations.

Fruit & Veg City, the owners of Food Lover’s Market and Freshstop forecourt stores, has a partnership with Caltex, while Woolworths has a similar partnership with Engen.

The first Spar Express store, to open on Wednesday, is at the Shell station on the corner of Webber Road and Karen Avenue in Germiston, Gauteng.

Shell also has its own Shell Select stores.

Mr Brown said the Spar Express stores would be smaller than Spar’s Kwikspar outlets, and the 24-hour stores would be designed for convenience.

Avior Research analyst Michael McLeod said on Tuesday that Spar’s forecourt roll-out "is broadly positive but is not a game changer" for the group.

Mr McLeod said while forecourt operations contributed to the likes of Pick n Pay and Woolworths’ earnings, "it’s never going to be a big contributor, and I think it will be the same for Spar".

However, "it is another platform and from that perspective it does increase the ability to drive top-line growth".

Mr McLeod said the move would also contribute "to a certain degree" to brand awareness, and could contribute — albeit in a small way — to Spar’s brand platform in Gauteng. The retailer was better represented in rural areas than in major cities, he said.

Shell South Africa GM for retail services Farouk Farista said the forecourt convenience retail market in the country was a fast-changing and highly competitive environment.

Most Popular

Mall of Africa Celebrates Launch of New Generation Pick n Pay Store

Sep 23, 2019
Today Mall of Africa welcomed one of South Africa's biggest grocery retailers to the…

Exemplar REITail Acquires Katale Square Shopping Centre

Sep 23, 2019
Real estate investment trust, Exemplar REITail, has acquired Katale Square shopping…

Grit Real Estate financial results for the year-ended 30 June 2019

Sep 30, 2019
London Stock Exchange listed Grit, the only listed Africa-focused income distribution…

4AX listed Heartwood Properties reveals positive financial results

Sep 23, 2019
Commercial property development company, Heartwood Properties , has revealed a 30%…

Reserve Bank keeps repo rate unchanged

Sep 23, 2019
 South African Reserve Bank Governor Lesetja Kganyago on Thursday said this is in line…

Please publish modules in offcanvas position.