CEO Pieter Engelbrecht gave the reasoning away in a single line. Shoprite, he said, has spent the past decade moving from a do-it-all philosophy to partnering or acquiring wherever somebody else already had the expertise, the capacity or the speed. On Tuesday, alongside results for the 52 weeks to 28 June, the group disclosed what that looks like in coffee: a signed share purchase agreement for Vida e Caffe and its roughly 400 corporate and franchise stores.
Vida is worth buying for where its shops are rather than how many of them there are. It runs high street cafes, petrol forecourts, drive-throughs, corporate office outlets and retail sites across eight African countries, every one of them a format a supermarket group does not operate. It turns 25 this year, having opened on Kloof Street in Cape Town in 2001 and reached its 400th store in June.
What Food Lover's said in 2015
The precedent is close enough to be useful. Food Lover's Market took over Seattle Coffee Company in 2015, having already spent years running the brand inside its own network, in FreshStop forecourt shops and its own in-store coffee bars. Spokesperson Travis Coppin said at the time that the deal let the group put a world-class coffee experience into all of its stores.
The scale it bought was small and the runway was not. Seattle had 21 cafes of its own when the deal was done. It has 331 today, on the Financial Mail's count, and Food Lover's has publicly aimed at 500.
The difference is in what each buyer was after. Food Lover's already had Seattle inside its forecourts and bought the brand to put it into more of its own stores. Shoprite is buying a chain that already stands on its own, in formats it does not run, and says it wants to learn from a business it admires while supporting its next phase of growth.
A grocer that grows by format, not by price
Shoprite's growth has come from new shapes rather than higher prices. Its own shelf inflation ran at 0.8% for the year against official food inflation of 3.9%, and merchandise sales still rose 7.2%, to R270.8 billion.
The pattern repeats across the group. Petshop Science, launched in 2021, is at 185 stores and grew sales 74.5%. Sixty60 added a record R6.6 billion. Coffee is the next format on the list, in a category the Financial Mail reports is growing while the rest of consumer spending is not.
The deal is small enough that the JSE does not require it to be categorised. It was signed in August, it needs regulatory approval, and it only takes effect in Shoprite's 2027 financial year. Until then Shoprite owns the agreement, not the coffee.
