Retail giant, Choppies, has set an ambitious target to reach US$1 billion revenue mark in the near future (approximately P10 billion), Botswana Guardian has heard.
Unveiling the company vision and future strategies, Choppies chief executive officer (CEO), Ramachandran Ottapathu, said they believe in goal setting and will not rest on their laurels until they achieve their target.
“When we reached the 10 000 employee mark, we set our next goal to achieve the US$1 billion revenue mark and I am pleased to report that we are almost on target. This is a watershed milestone for the company and for me, personally, as it marks the realisation of a long-held dream,” said Ottapathu in a statement in the 2017 integrated annual report.
In 2017, the company generated revenue of P9 billion and opened 29 new stores across sub-Saharan Africa in total, including five in our core Botswana market, 10 in South Africa, seven in Zambia, two in Zimbabwe, three in Kenya and one each in Tanzania and Mozambique.
“We are particularly pleased with the progress of our footprint expansion in our existing markets of operation given that they are all experiencing economic difficulties. Nonetheless, in South Africa, Zimbabwe and Zambia, we have capacity to add more stores to the current distribution network,” said the CEO.
He added that this will help maximise economies of scale and improve profitability and Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) by a significant margin.
He said significant growth in online business has occurred and digital marketing is rapidly competing with traditional retail mediums. In order to capitalise on this opportunity, Ottapathu said they will soon be launching online business, which will enable their customers to shop from home with store-to-door deliveries in fixed time slots.
He added that this would enhance their competitiveness with their supermarket peers. According to the group chairman, Festus Mogae, continued expansion in sub-Saharan Africa will be furthered by new stores being opened in Namibia in the near future.
“Of course, challenges have to be faced when entering new markets. Profitability takes time to come to fruition while establishing the business and putting the required infrastructure in place to generate the desired efficiencies and create operational critical mass,” he said, adding that the expansion strategy is fully supported by the board in its oversight role.
Mogae added that as the group grows, a full appreciation of the capital expenditure and overall future investment requirements is carefully considered. He said the maturing geographies help support the new investments and expanding the Choppies store footprint.
Mogae said consumers can avail themselves of a full range of products with an expanding service offering and, beneficially, more Choppies branded products.
“Sustainability of the group is supported by continuous training and upliftment of staff and suppliers, with special emphasis on making local purchases, wherever possible. This particularly applies to farmers’ produce,” said the Group chairman.