Shoprite To Sell Shops In Ghana and Malawi
South African retail giant Shoprite Holdings has announced plans to sell its operations in Ghana and Malawi, marking its latest withdrawal from African markets as it refocuses on its home base.
In a trading update, the company confirmed receiving a binding offer in June for its seven stores and one warehouse in Ghana, classifying the business as “discontinued” under accounting standards. Similarly, Shoprite Malawi signed an agreement to sell five stores, pending regulatory approvals. The move continues a strategic retreat that has seen Africa’s largest grocer exit Nigeria, Kenya, Uganda, Madagascar, and the Democratic Republic of Congo since 2021.
Challenges In African Markets
The decision underscores the mounting challenges multinational retailers face across African markets, where currency volatility, soaring inflation, and restrictive trade policies have eroded profitability. Shoprite specifically cited dollar-denominated leases, import restrictions, and supply chain disruptions as persistent obstacles.
Despite once operating in 15 African countries, the company has gradually scaled back its pan-African ambitions, instead concentrating investment on its dominant South African operations, where it continues expanding stores and digital services like its Sixty60 delivery platform.
Drop In Stocks
Market reaction was immediately negative, with Shoprite shares dropping 2.6% on the Johannesburg Stock Exchange following the announcement. Analysts note the exits reflect broader difficulties for formal retail in Africa, where informal markets dominate and economic instability complicates scaling.
Competition From Melcom
In Ghana, Shoprite faced stiff competition from local chains like Melcom and regional players, while Malawi’s smaller economy offered limited growth potential.
The company did not disclose potential buyers but indicated the Ghana deal is “highly probable” to proceed.
Strong Performance In Home Country
While retreating from multiple markets, Shoprite reported strong performance in its core South African business, projecting up to 19.4% growth in headline earnings per share for its 2025 financial year.
The retailer has aggressively expanded domestic offerings, venturing into pet care, healthcare, and outdoor equipment.
Conclusion
This strategic pivot highlights the diverging fortunes between South Africa’s robust formal retail sector and the challenging operating environments elsewhere on the continent, where even established chains struggle to maintain viable operations. The Ghana and Malawi disposals are expected to conclude pending regulatory approvals in coming months.
