Massdiscounters — especially Game — has been fighting an uphill battle over the past few years and following another six months of disappointing sales, Massmart has announced that Game is being restructured. The division’s sales were down 4% down to R9.1-bn during the first six months of the financial year, with Game SA sales dropping 2.3%.
The merchandising and buying teams have been reorganised and the head office moved from Durban to Johannesburg. An initial experiment in five Game stores to create more of a discount look with more stacked bulk displays and emphasis on price signage, was successful, and a further 15 stores will be converted to this format by the end of November.
Masswarehouse sales grew 5.4% to R12.9-bn in this period which CEO Guy Howard describes as a perfect storm with all the economic negatives. Despite this, Makro’s higher income customers ensured good sales in durables. Private label sales also showed good growth and good margin improvements, especially in fitness brand Trojan and camping equipment from Campmaster, reports Howard.
Overall, the demand for durables is soft as consumers rather spend money on food and are delaying their spending to wait for promotions. Sales of semi-durables like clothing was, for example, 6.1% down.