May 8, 2015


South Africa’s largest food retailer today (Sunday, 08 February 2015) in the Sunday press challenged all food companies in the country to pass their fuel savings onto South African consumers.

In a full page advertisement the call from the Shoprite Group is “Give the money back to the People”. It cited the fourth decrease in the price of petrol since August last year after the oil price has fallen from $ 103 per barrel to $ 53 per barrel in January this year.

Estimating that with the fuel price in South Africa at its lowest level since 2007 consumers has had an average saving of almost R200 each time they fill up their  tank. The distribution costs of food suppliers has fallen simultaneously and Shoprite believes that this saving must be passed onto consumers.

The Group has already poured its fuel bill savings achieved so far for its fleet of more than 580 distribution trucks into food prices. It furthermore, through savings in the supply chain, prevented price increases of over R1 billion from reaching its customers over the past year.

Shoprite also funded many subsidies on basic foods which enabled customers to buy more with their money.  Most recently in January 2015, the savings on its fuel bill were passed on to consumers by reducing amongst others the price of 4.7m loaves of bread.

In the past year lowering the price of 1675 tons of sugar, 4.8m litres of oil and 203 tons of maize also passed on savings to consumers.

In January for example, a 7kg pocket of potatoes was on average 15% cheaper than a year ago, whilst a 2kg bag of Sunlight Regular washing powder was on average 30% cheaper than January last year.
In line with the fuel savings, the Group’s internal food inflation has slowed each month since the August 2014 reduction and reached a 13 month low of just 4% in December 2014.

Shoprite’s internal inflation is consistently lower than the official food inflation rate and has remained 3% below the official food inflation rate of 8.2% for the last six months.

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