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Woolworths (South Africa)

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Woolworths Holdings Limited is a South African multinational retail company that owns Woolworths, a South African luxury department store chain, and Australian retailer Country Road Group.

Woolworths Holdings Limited
Company typePublic
JSE: WHL
ISINZAE000063863
IndustryRetail
Founded1931; 93 years ago (1931)
FounderMax Sonnenberg
Headquarters93 Longmarket Street, Cape Town, South Africa
Area served

Botswana
Eswatini
Kenya
Lesotho
Mauritius
Mozambique
Namibia
South Africa
Tanzania
Zambia
Key people
Roy Bagattini (Group CEO)
Hubert Brody (Chairman)
ProductsClothing, footwear, accessories, groceries, beauty products, homeware and financial services.
RevenueIncrease R85.6 Billion (2021)
Increase R6.87 Billion (2021)
Increase R4.16 Billion (2021)
Number of employees
45,000
DivisionsWoolworths (South Africa)
Country Road Group (Australia)
Woolworths Financial Services
Websitewoolworthsholdings.co.za
woolworths.co.za

The South African Woolworths business consists of luxury goods, being fashion, home and beauty stores, many of which incorporate a premium food retail offering. Stand-alone food stores and "Food Stops" attached to Engen petrol stations are found in urban areas. Woolworths operates 218 full-line stores and 430 food stand-alone stores in South Africa,[when?] with 64 stores throughout the rest of Africa.[when?] Woolworths sells clothing and accessory items under several brands, namely Studio W, RE: and Edition, with the Group's Australian brands Country Road, Witchery and Trenery also represented.

The Group's Australian-based speciality apparel and homewares retail subsidiary, Country Road Group, operates 557 stores[when?] (and a further 242 concession locations within David Jones). The Group operates under separate brands Country Road, Witchery, Trenery, Mimco and Politix.

History

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Founded by Max Sonnenberg, Woolworths first opened its doors on 30 October 1931 in Plein Street, Cape Town, in the dining room of the recently closed-down Royal Hotel. Its success led to the opening two more stores in the Cape area.[citation needed] It was clear that the new business had the potential to expand nationwide except for a lack of capital. Sonnenberg's friend Elie Susman put up the money for the expansion of the business into the Transvaal and became Sonnenberg's business partner.[citation needed]

 
The first Woolworths store, in the stately dining room of The Royal Hotel, Cape Town.
 
Braai-related display inside a Woolworths store in The Constantia Village shopping center, in Constantia, Cape Town, South Africa.

The choice of name came from Sonnenberg's friendship with a London shipper and financier, Percy (P.R.) Lewis. Lewis was a director of Australasian Chain Stores, ACS, a London shipping and finance house formed to service a rapidly expanding Australian business founded by W.T. Christmas. London shippers commonly provided finance and often selected goods, sight unseen, which were dispatched to their clients. Given that the (now defunct) American company F.W. Woolworth Company had no desire to trade in Australia, "Father" Christmas as he was known, used the name for his new Woolworths enterprise. Lewis proposed to Sonnenberg that ACS could add to 'Father' Christmas's order sheet and send a scaled-down quantity of every succeeding item in Australia to South Africa. Sonnenberg therefore, also adopted the name for his new venture. Two years later, a South African court ruled that sufficient goodwill had been established to refuse an injunction brought against the use of the name by the American retailer.[1]

In 1998, Woolworths acquired a controlling interest in Australian clothing retailer Country Road. However, Woolworths was unable to take the Country Road private due to Solomon Lew refusing to sell his 11.67 % stake in the company.[2][3] Woolworths took full ownership of the Country Road in July 2014 when it purchased Lew's shareholding for $200 million.[4][5]

In 2014, Woolworths purchased an Australian department store business David Jones for A$2.1 billion. Woolworths sold David Jones to private equity firm Anchorage Capital Partners in December 2023.[6]

Corporate affairs and culture

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Good Business Journey

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Starting in 2007, the Good Business Journey set specific public targets in sustainability for the company.[7] It also aims to achieve a consistent approach to sustainability issues across its global supply chain, as part of Woolworths' declared target of being the most sustainable retailer in the southern hemisphere.[8]

In 2016, the company launched its GBJ goals to 2020, including embedding the programme into the Group's Australian businesses, which now account for over forty per cent of turnover.[9][10]

The WHL Group GBJ 2020 commitments include: contributing over R3.5 billion across the Group to communities over the next 5 years; saving 500 billion litres of water over 5 years; ensuring the company halves its energy impact by 2020 and achieves 100% clean energy by 2030; driving responsible sourcing of all key commodities by 2020; and affirming that every private-label product sold has at least one sustainability attribute by 2020.[9]

Sustainable development goals

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Zero packaging waste to landfill

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In June 2018, Woolworths announced its intention to achieve zero packaging waste to landfill by 2022, aiming to have none of its packaging end up in landfills, which would require a 100% recyclable material for its packaging and a supportive recycling infrastructure.[11][12] Woolworths also committed to phasing out single-use plastic shopping bags completely by 2020.[13]

In August 2018, the Palmyra store in Claremont introduced in-store recycling vending machines.[14]

Reusable bags

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Woolworths launched a new in-store reusable bag trial in October 2018 as part of the phasing out of plastic bags.[15]

Starting on 5 November 2018, these new, entry-level, reusable shopping bags were made available in four stores across the Western Cape (V&A Waterfront, Palmyra, Pinelands and Steenberg), and have since been distributed to additional stores.[16]

Woolworths Steenberg went plastic bag-free for the trial, with customers having the choice of either purchasing a reusable bag or bringing their bags. The current single-use plastic bags were still available in the remaining three stores. April 2019, additional plastic bag-free stores were announced in Maroun Square, Moreleta Village and Delcairn Centre.[17]

Partnership with Pharrell Williams

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In 2015, Woolworths announced a partnership with American musician Pharrell Williams.[18][19] The strategic collaboration was the first of its kind for a South African retailer.

Williams took on the role of Style Director in a collaboration across a series of sustainability-focused projects. The campaign had four layers: entertainment, showcasing young talent, fundraising for education, and driving sustainable fashion.

Black Economic Empowerment Employee Share Ownership Scheme

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In July 2015, Woolworths announced the maturity of its Black Economic Empowerment Employee Share Ownership Scheme (BEEESOS).[20]

The scheme was launched in 2007 as part of the company's Good Business Journey and is one element of the company's commitment to socio-economic transformation. Woolworths was the first retailer to launch an empowerment scheme with BEEESOS shares allocated to previously disadvantaged employees based on both length of service and seniority. The scheme represented approximately 10% of the ordinary share capital of Woolworths at the time.

The business's strong performance over the past eight years has created R2.4 billion for the participants, who have also enjoyed dividends of R332 million during the scheme's life.

Controversies

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Christian magazines

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In October 2010, Woolworths came under fire as they opted to remove Christian magazines from their shelves and discontinue their sale. This was met with a huge outcry from the Christian community, with many voicing that they would boycott the chain store.[21] Woolworths maintained it was strictly a business decision, with CEO Simon Susman attributing their decision to diminishing number of sales.[21] Woolworths returned the five magazines to its shelves following the outcry.[22]

Affirmative action

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See also: Black Economic Empowerment

In September 2012 Woolworths was accused of racism by some groups for allegedly discriminating against white job applicants and staff.[23] The accusations followed after claims that the retailer's advertising on their career site said its jobs are only open to "African, Coloured and Indian" candidates.[24] Shortly after the incident, Woolworths changed the advert text to say "In accordance with Woolworths' Employment Equity approach, preference will be given to candidates from designated groups".[23] Various public groups and communities have called for the aggressive boycotting of Woolworths, as was done with the Dis-Chem pharmaceutical retail group following their decision not to consider white applicants for employment.[citation needed]

Promotion of LGBTQIA+ merchandise

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In June 2023, Woolworths was criticised publicly by, amongst others, religious groups including the Muslim Judicial Council and Christian groups for promoting LGBTQIA+ merchandise to young customers.[25] Following the outcry, Woolworths released a statement stating that they refused to back down on the marketing campaign as part of Pride Month.[26]

Plagiarism

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Pillow designs

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In October 2013, rumours of plagiarism surfaced when Euodia Roets, a South African artist, accused Woolworths of using her designs that were kept as samples after contract negotiations failed.[27] In her article Roets shows illustrative images of her design and compares it to a cushion later sold by Woolworths on which a strikingly similar design was used. Woolworths denied these allegations on their website.[28] In her allegations Roets also claimed "If that text is in fact from Wikipedia, Wiki requires attribution on all commercial use of their text. You'd be correct in assuming Woolies did no such thing." The text used on the design is an exact match of portions of text lifted from Wikipedia's Hummingbird article, without attribution, in violation of its Creative Commons License. When pressed on the matter, the official Woolworths South Africa Twitter account opined that "We've checked with our lawyer; Wikipedia does not own the content."[29]

Baby carriers

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In January 2019, Woolworths withdrew a line of baby carriers the design of which was allegedly copied from a domestic South African designer and manufacturer (Ubuntu Baba) and sold at one-third the price of Ubuntu Baba's version. The baby carrier scandal broke out after Shannon McLaughlin of Ubuntu Baba wrote a blog post about it that then became a popular issue on social media.[30] McLaughlin alleged that several Ubuntu's carriers were purchased by and delivered to Woolworths Head Office in June 2017 around a year before the Woolworths carriers hit the market.[31] Woolworths admitted that their baby carriers were derivatives of McLaughlin's product and issued an apology.[32]

Soft drink imitation

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In early 2012, the South African Advertising Standards Authority ruled that Woolworths' vintage cold drink range was an imitation of Frankie's Soft Drinks range. It was ruled that Woolworths intentionally copied the phrase "Good Old Fashioned Soft Drinks" to promote its line of beverages thereby infringing on the rights of Frankie's Soft Drinks. Woolworths agreed to remove the range immediately.[33] After the event Woolworths South Africa's CEO Ian Moir publicly stated that "Public opinion is so much against us and, whether we're right or whether we're wrong, customer opinion is against us."[34]

References

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  1. ^ Susman, David (2004). An African Shopkeeper. Cape Town: Fernwood Press. p. 27. ISBN 978-1-874950-78-3.
  2. ^ Evans, Simon (26 November 1999). "$80m debt load sinks Sportsgirl". Australian Financial Review. Retrieved 17 February 2024.
  3. ^ Treadgold, Tim (9 July 1999). "Out of South Africa". Australian Financial Review. Retrieved 17 February 2024.
  4. ^ Verrender, Ian (24 June 2014). "Woolworths' offer to buy Lew out of Country Road raises questions". ABC News. Retrieved 17 February 2024.
  5. ^ Greenblat, Eli (25 July 2014). "Solomon Lew accepts Country Road offer, ending 17 year battle". The Sydney Morning Herald. Retrieved 17 February 2024.
  6. ^ Koehn, Emma (19 December 2022). "'Storied history': David Jones gets new owners just in time for Christmas". The Sydney Morning Herald. Retrieved 17 February 2024.
  7. ^ "Woolworths sets Good Business Journey goals for 2020". www.bizcommunity.com. Retrieved 31 July 2020.
  8. ^ "Woolworths Holdings Limited Annual Report" (PDF). marketscreener.com. Retrieved 31 January 2020.
  9. ^ a b "Woolworths sets Good Business Journey goals for 2020". Bizcommunity.com.
  10. ^ "Company Snapshot". Fin24.
  11. ^ "Woolworths is ditching its wasteful plastic packaging – here's what is changing". BusinessTech.co.za.
  12. ^ "Woolworths commits to being 100% recyclable by 2022 | CapeTown ETC". www.capetownetc.com. Retrieved 11 December 2019.
  13. ^ Writer. "Woolworths is ditching its wasteful plastic packaging – here's what is changing". Retrieved 31 July 2020.
  14. ^ "Woolworths pilots SA's first in-store recycling vending machine". Fastmoving.co.za. Retrieved 11 December 2019.
  15. ^ "These Woolworths stores are switching to reusable plastic bags – and plastic bags have been entirely banned at one outlet". Business Insider.
  16. ^ "Next phase in plastic bag free trial announced". The Green Times. 28 May 2019. Retrieved 11 December 2019.
  17. ^ "Woolworths to open more 'plastic bag free' stores". www.bizcommunity.com. Retrieved 11 December 2019.
  18. ^ Arts Desk (10 April 2015). "Pharrell Williams collaborating with Woolworths". mg.co.za. Mail & Guardian. Retrieved 9 April 2020.
  19. ^ "Pharrell Williams partners with Woolworths". citizen.co.za. 9 April 2015. Retrieved 11 December 2019.
  20. ^ "R2.4bn BEE pot matures for Woolworths staff". Fin24.
  21. ^ a b "Woolworths bans Christian mags". News24. Retrieved 3 September 2017.
  22. ^ Woolworths repents – Times LIVE
  23. ^ a b Peter Church (3 September 2012). "Racist Woolworths SA defiant". SA Promo. Archived from the original on 17 January 2013. Retrieved 14 January 2013.
  24. ^ Fadia Salie (4 September 2012). "Woolworths douses racial fires". News 24. Retrieved 14 January 2013.
  25. ^ van Zyl, Ané (7 June 2023). "PRIDE-REEKS Woolies 'wil brûe bou' met veldtog: 'Hartseer' oor party mense se reaksie". Beeld. p. 3.
  26. ^ van den Heever, Megan (13 June 2023). "Woolworths feels heat from religious groups over Pride campaign". The South African. Archived from the original on 13 June 2023. Retrieved 14 June 2023.
  27. ^ Pedeboy, Delphine (21 October 2013). "Copyright, credit, Woolworths and the hummingbird". Ground Up. Retrieved 26 July 2016.
  28. ^ [1] Cushion Design Allegation
  29. ^ "Woolworths South Africa Twitter". Twitter. Retrieved 22 October 2013.
  30. ^ Claasen, Larry (10 January 2018). "Red-faced Woolworths apologises and pulls 'similar' baby carrier". www.businesslive.co.za. Retrieved 10 January 2019.
  31. ^ Tswanya, Yolisa (10 January 2019). "Woolworths removes baby carriers over 'copying' controversy | Cape Times". www.iol.co.za. Retrieved 10 January 2019.
  32. ^ Whitfield, Bruce (9 January 2019). "Woolworths admits trouble with its baby carrier design, yanks its Ubuntu Baba lookalike from shelves". BusinessInsider. Retrieved 10 January 2019.
  33. ^ Peters, Sherlissa (2 February 2012). "Woolworths to remove entire soft drinks range". iol. Retrieved 6 June 2012.
  34. ^ Nicolson, Greg (1 February 2012). "Frankie's vs. Woolworths: Good old-fashioned David-and-Goliath battle". Daily Maverick. Retrieved 6 June 2012.
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