Spar says its on-demand shopping app for groceries and alcohol, Spar2U, is on the verge of reaching critical mass.
“Rapid progress has been made with the integration of 87 sites as of September 30, 2022,” the company said in its annual results on Wednesday.
“Interest levels from Spar retailers to use the new platform remain high and this should strengthen Spar’s ability to help retailers improve service and engage consumers in the future,” the company said. .
“This ‘Solution as a Service’ is specifically tailored for Spar’s interdependent retail model and takes all the onerous effort out of the hands of our retailers, allowing them to focus on commerce.”
Spar said feedback from consumers using this new channel has been overwhelmingly positive.
My Broadband tested the service in September and found it to be working well with our delivery arriving slightly ahead of schedule.
Spar is taking on Pick n Pay, Woolworths and Checkers in the fiercely competitive same day delivery market for fast moving consumer goods.
Checkers’ Sixty60’s one-hour on-demand grocery delivery service, launched in late 2019, set the standard for the country.
Pick n Pay has joined the e-commerce race in 2020 with Asap! (originally Bottles), and announced a partnership with Takealot to list his groceries in Mr D’s food delivery app.
Woolworths launched its same-day service, Woolies Dash, in December 2020.
Wednesday, Woolworths saw 26% growth for Woolies Dash in South Africa during its 20-week trade update.
For its overall results, Spar recorded a 6% increase in group revenue to R135.6 billion and a 1.1% increase in operating profit to R3.4 billion during the the year.
However, overall earnings per share decreased by 3%, while dividends per share decreased by 51%.
Spar said it was temporarily adjusting its dividend policy, cutting the dividend for two years, to fund, among other things, its strategic investment in SAP.
“The Group’s profitability continued to be affected by the consequences of the pandemic in the first half of this financial year and new geopolitical circumstances which saw all regions come under pressure on fuel and energy costs”, said declared Spar.
“In South Africa, these pressures have been further exacerbated by the impact of ongoing power outages.”