Choppies

Choppies Enterprises Limited is a Botswana multinational grocery and general merchandise retailer headquartered in Gaborone, Botswana. Initially selling only food-based (both fresh groceries and wholesale long-life foods) and other fast-moving consumer goods. The group owns a centralised, in-house distribution network in South Africa, Zimbabwe, Zambia and Kenya.

Choppies Enterprises Limited

Type	Public limited company
Traded as	BwSE: CHOPPIES JSE: CHP
Industry	Retailing, Fast-moving consumer goods
Founded	1986 (1986) (Lobatse, Botswana)
Headquarters	Gaborone , Botswana
Number of locations	124 stores
Area served	Botswana, Zimbabwe, Zambia
Key people	Uttum Corea - Chairman Farouk Ismail - Deputy Chairman Ramachandran Ottapathu - Chief Executive Officer Vidya Sanooj - Acting CFO Tom Pritchard - Independent Non-Executive Director Carol Jean Harward - Independent Non-Executive Director
Products	Hyper stores, Super stores and Value stores
Services	Airtime, data recharges, bill payments, tickets, mobile starter packs money transfers.
Revenue	BWP 2.96 billion (half year ending Dec 19)
Operating income	BWP 680 million (half year ending Dec 19)
Net income	BWP 139 million(half year ending Dec 19)
Number of employees	15,234 (As of June 2017)[1]
Website	www.choppies.co.bw

Choppies became a listed company on the Botswana Stock Exchange on January 26, and is a constituent of the BSE Domestic Company Index with an approximate market capitalisation of P2.4 billion as at 20 December 2012.[2]

The company also completed its secondary listing on the Johannesburg stock exchange on 27 May 2015.

History

Choppies was founded in 1986 with one supermarket named Wayside Supermarket (Proprietary) Limited in Lobatse by the Chopdat family, with a second store opening in 1993.

Since 1999, when the company only had two stores, the management team, which included the founding members of Choppies Mr Farouk Ismail (Current Deputy Chairman) and Mr Ramachandaran Ottapathu (Current CEO) (who are both also the major shareholders with each holding 34.2% of the shares), the company executed aggressive growth, consolidating the group into one structure in 2003 (previously franchising under different names) to become the dominant leader in the fast-moving consumer good industry in Botswana.

Due to its exponential growth since 1999, demand for the company become listed on the nation's stock market eventually took its toll on the management team and the company became listed on January 26, 2012. The company hired Grant Thornton to manage the administration front of the firm's Initial Public Offering, with 1.2 billion shares being listed at an offer price of BWP 1.15 per share,[3] with 25% going into the hands of the public. The IPO was the largest on the Botswana Stock Exchange raising P350 million in both the IPO and the private placement, with the shares being oversubscribed by up to 400%.[4][5]

Operations

The South African operations are executed through a wholly owned subsidiary Choppies Supermarkets SA (Proprietary) Limited, which operates in the Limpopo, North-West and Free State provinces.

Distribution and supply

Choppies' distribution centres function as a central sourcing for Choppies stores. The company's top 200 products are delivered in bulk to the distribution centres and then distributed from there to the stores. Other products are delivered from the source to the stores directly. Choppies operates two distribution centres in Botswana; one in the International Commerce Park in Gaborone, and the other in Lobatse. A new 10,000m² South African distribution centre opened in September 2012 in Rustenburg to serve the South African stores.

Welldone (Proprietary) Limited, a wholly owned subsidiary of the Choppies Group, is a logistics company that supports the day-to-day operations of the stores. The company has a fleet of 245 commercial vehicles which distributes products to all Group stores. The fleet of vehicles are all branded with the Choppies logo.

In 2008 first store in Zeerust, South Africa was opened there by expanding in the north west region. 2014 was the year when the group opened its first distribution centre in Zimbabwe and in the year 2016 the secondary listing was done in the Johannesburg stock exchange. By the end of 2015 Zambian operations began and in early 2016 saw the acquisition of Jwayelani group in Durban, South Africa. Kenyan acquisition of Ulkwala group was also carried out in early 2016. As part of long term growth plan the group opened its first store in Tanzania and Mozambique in 2017.

Store types and product ranges

The Choppies Group operates hyper stores, super stores and value stores depending on their respective sizes, selling over 45,000 different products. Choppies sells both branded and own-brand products, primarily packaged and long-life foods. All of our stores are located in urban, semi urban and rural areas in sub-saharan Africa, with proximity to residential areas and transport nodes.

The group owns 286 quality own brands ranging from food and beverages to cosmetics, clothing and cleaning products.

Marketing and branding

The company's main competitors include retailers SPAR, Pick N Pay, Woolworths Foods, Shoprite and small local general dealers. The Group has a current market share in Botswana of 30%, according to an independent survey conducted by Briggs and Associates. Even though there are many competitors Choppies has managed to expand to some African countries starting with South Africa where it is in tough competition with its rivals it is still the preferred retailer giving it an upper hand that is why it is able to explore foreign markets.

Corporate social responsibility

Botswana

• In partnership with Virgin Active Gaborone, Choppies organised a Wellness Day for staff members to promote health and wellness in the workplace. • Together with the Lady Khama Charitable Trust Fund, Choppies donated BWP 1.2 million in groceries to border patrol soldiers and nurses working over the Christmas holidays. • Donation of food hampers to Gamodubu Children Home in Gaborone, which cares for over 100 children under the age of 17. • Participation in a lunch for Gabane House of Hope, an old age home located in Gabane. Choppies also donated blankets and towels. • Organised a lunch for orphans at Childline Botswana on Mother's Day.

South Africa

• Donation of hampers to Women Against Rape. • Donation of grocery hampers to a children's community centre . • Donation of snack hampers to a children's centre in Boeshoek, North West.

Zambia

• Support to Njovu Community Centre in Chibolya province, which provides education activities and sponsorship for over 200 troubled youth.

Zimbabwe

• Donation of groceries to Ingutsheni Central Hospital in Bulawayo.

Criticism

Choppies has attracted criticism from the public in the past due to salary discrepancy. Employees such as cashiers and packers claim to earn less than P900 a month, whilst executives such as the CEO and Deputy Chairman earn more than P30 000 000.00 per annum. This has attracted outrage as the company is historically very profitable yet is not rewarding the lower-skilled workers on terms they consider fair to their efforts; in 2011 the Group made over P124 million in after-tax profits, with a dividend in excess of P121 million being paid out to shareholders.[6]

References

1. Choppies Enterprises (2012). "Choppies Enterprises Annual Review and Summary Financial Statement 2012" (PDF). Choppies Enterprise Annual Review and Summary Financial Statement 2012. Choppies Enterprises. Retrieved 21 December 2012.
2. "Choppies market data from the BSE"
3. "Results of Choppies IPO"
4. "Choppies shares offer 400% oversubscribed|publisher=Mmegi| accessdate =24 January 2012"
5. "Mmegi Online :: Choppies sparkles on BSE debut". Mmegi Online. Retrieved 2017-08-16.
6. "Mmegi Online :: Choppies: Some animals are more equal than others". Mmegi Online. Retrieved 2017-08-16.

External links

• Official Website
• Bloomberg Market Data