An exit from Mozambique could be on the cards for Shoprite group

He cited concerns about the viability of the Mozambican market, given Islamist insurgent activity in the north of the country which has stalled a liquefied natural gas project. This would have given the country’s economy a major boost. 

Engelbrecht told Reuters that Shoprite’s operations in Mozambique were under review and “on a watch list”, but stopped short of confirming an exit. 

Shoprite’s focus is closer to home 

South African-based Shoprite has been paring back its once-ambitious pan-African expansion strategy to focus on Southern African countries closer to its home base.  

It now has just under 270 stores in seven SADIC member countries. Among these are Angola, Namibia, Botswana and Zambia. 

In recent years it has exited Nigeria, Kenya, Democratic Republic of Congo, Uganda and Madagascar. Plus, there are the pending exits from Ghana and Malawi. 

Engelbrecht also told Reuters that the company has no further plans to enter any new African markets and, if it did so, it would use a different business model. 

In South Africa, Shoprite is hugely successful and is the dominant supermarket player with an ongoing expansion strategy. Among its South African brands are Shoprite, Checkers, Usave (all supermarkets) Medirite (pharmacies), Checkers Liquorshop, Checkers Outdoor, and Petshop Science. Its Sixty60 home delivery grocery service has also become a brand in its own right. 

Persistent challenges faced by retailers 

Commented Business Insider Africa when Shoprite announced its exit plans in Ghana and Malawi: “Shoprite’s move has revealed the persistent challenges faced by global retailers across several African economies, where currency volatility and shifting economic policies can quickly erode margins. 

“The company has encountered numerous obstacles in these regions, including unstable exchange rates, surging inflation, restrictive import regulations, and leases pegged to the US dollar – all of which have weighed on profitability.