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Masswarehouse
Masswarehouse comprises Makro and The Fruitspot. Makro sells national and owned brands in the Food, Liquor and General Merchandise categories, catering for personal, commercial and trading customers. The Fruitspot is a wholesaler and distributor of fresh and cut fruit and vegetables in Gauteng, KwaZulu-Natal and the Western Cape.
2016 Highlights
  • Makro Carnival opened in April 2017 achieving record sales on opening day and during its first month of trading
  • Continued growth of retail and commercial Food business, supported by extended national sales capability
  • Continued growth of online sales, with B2B segment growing in contribution
  • Conversion of more than 1,300 contract workers to permanent employees
2016 Strategy
  • Continue to grow our commercial sales and customer service offerings
  • Reduce cost to operate fulfilment network
  • Continue to improve the Food offering to retail customers, and deepen Fresh and Butchery offering
  • Grow market share in Liquor
  • Grow market share in retail and commercial segments, maintain margins and share in wholesale markets
  • Optimise working capital through replenishment and supply chain investments, while ensuring adequate inventory levels
  • Drive value through data-led insights into customer behaviours and needs
  • Invest in technology to better serve customers, manage our supply chain and operate stores
Delivering on our strategy
What we did well:
  • Continued maturation of fulfilment capabilities, through building a multi-channel network to service a wide range of customer and product needs
  • Improvement in working capital performance, in part through the continued adoption of automated algorithm-based replenishment methods
  • Delivered online commercial functionality
  • Launched Makro marketplace
The improvements we made:
  • Improved forecasting and replenishment capabilities
  • Improved mature stores’ profitability
  • Improved the employment equity profile of Executive and senior management teams
  • Better use of customer and market data to optimise promotional and pricing activity
The challenges we’re facing:
  • Low consumer confidence and weak spending power
  • Slowing and variable inflation, particularly in food commodities
  • Rand volatility causing import price challenges
  • Aggressive trading practices from independent wholesale competitors
  • Availability of real estate for new stores in South Africa
Strategic focus for 2017
  • Ensure we balance our investment in inventory for availability and price
  • Invest in our owned brands so that we continue to bring relevant products at best value to our customers
  • Empower our employees with better data and simpler process to be more effective, at less cost
  • Build and operate our stores in an environmentally responsible manner
  • Complete the construction of the new Makro store in Johannesburg north
  • Reduce cost through process optimisation and better contracting with service providers and suppliers
Future outlook

Makro remains focused on bringing the benefits of scale to all our customers. We will do this by offering products and brands that our customers know and trust at prices that save them money. Makro will continue to work on providing access to our proposition to all customers, and on building relevant and cost-effective fulfilment capability to support this. At The Fruitspot we will grow the business by ensuring it becomes a supplier of choice to the retail and hospitality industry, and in the Group.

11.0%
Sales
R26,270.3 million
2015: R 23,675.9 million
4.4%
Trading Profit
R1,251.3 million
2015: R1,198.7 million
20
Stores
2015: 19 stores
217,907
Total trading space
2015: 195,794 m²
Management team
Guy Hayward (Non-Executive Chairman)
Doug Jones (Chief Executive Officer)
Dean Bauer (Supply Chain)
Michelle Chandler (Human Resources)
Norman Gray (Non-Executive)
Garry Hendry (Merchandise: Food)
Stuart Jowett (Merchandise: General Merchandise)
Jonathan Koff (Merchandise: Liquor)
Gert Lourens (Operations)
Joe Ralebepa (Non-Executive)
Pieter Schoeman (IT and Projects)
Deepa Sita (Finance)
Craig Stewart (Commercial)
Johannes van Lierop (Non-Executive)
Melanie van Rooy (Marketing)