Question One
In class, we have scoured the financial results of numerous JSE-listed South African public companies, including several chain store retailers. One of these, Pick n Pay Holdings Limited, operates Pick n Pay Clothing in 277 stand-alone clothing stores, as well as in 21 Hypermarkets and 163 Supermarkets. An entrant to this channel that may be considered “late to the party” is Shoprite Holdings Limited, with only 19 UNIQ clothing outlets in South Africa at present , located in what appears at first glance to be high-end shopping centres.
While both these competitors enjoy an online presence, the UNIQ stores do not retail clothing online—at least for the time being—and that gives one pause for thought.
Prepare an argumentative report which argues which of the two business models represented by Pick n Pay Clothing and Shoprite Holdings’ UNIQ clothing represents “the better business model”.

Question Two
Big farming, big industry, big business, and thence to big conflict. Our species’ development journey has exposed the immense prospect for quarrel, as we employ ever more sophisticated devices and methods to create, deliver and capture big business value. The impact of big business on societal wellbeing is not disputed any longer. If anything, arguments arise on how best to set to rights the role business plays in global society. Niall FitzGerald, whose career spanned over 30 years at Unilever, culminating in eight years as Chairman and CEO has this to say about responsible and sustainable management practice:
I am absolutely clear that this is not some soft discretionary social agenda, but a hard-edged business issue. For me, at the centre of this whole analysis, is the consumer, on whom businesses are ultimately, utterly dependent. The consumer is simultaneously the citizen—the citizen in the society we impact through the way we run our business operations. Over time, their consumer choices will be driven by their responses to us and our companies, as citizens. If we are not seen to be committed to the communities within which we are allowed to operate, they will make their consumer choices in favour of others. Corporate reputation underpins the sustainability of the organisation. It is built slowly and deliberately, brick by brick. It can be lost in an instant—a misjudgement, a thoughtless comment, a careless approach to our consumers or communities. Trust lost departs on a fast horse and returns if ever, slowly on foot.
Business impact on, or interaction with, society can be seen in three distinct areas: the company’s own operations, the company’s relations with its business partners through the value chain, and the philanthropic contributions it makes—the ‘visible tip of the iceberg’ of the much larger impact of business operations. Voluntary contributions pale into insignificance in comparison with the impact of core business activities.

I draw your attention to the Woolworths Holdings Limited Good Business Journey Report: 2023, available here. Bundled with the WHL 2023 FYE Annual Financial Statements and related reports (which you can locate here), the Good Business Journey (GBJ) details the Woolworths view of corporate social responsibility. Is it authentic and sincere? I leave that to you to decide. Perhaps it helps your decision to know that “in a first for [Woolworths], sustainability measures are now included as one of the performance conditions of our executive long-term incentive scheme, ensuring a direct link between our GBJ and how management is incentivised and rewarded”.
In any event, this is your task: I want you to evaluate the Woolworths Good Business Journey, and conclude whether the GBJ represents a transparent, sincere, and successful attempt by this corporation to honour the principles of responsible and sustainable management practice. Present your analysis and argument in a persuasive narrative essay.

Question Three
Prepare a persuasive evaluation of the relative financial performance of Pick n Pay Holdings Ltd and Shoprite Holdings Ltd, ensuring that you undertake your analysis over a reasonably comparable temporal period (in other words, over similar financial year, covering nominally the same trading periods and national circumstantial events.
This will necessitate that you devise a way to compare (and contrast) the performance metrics (ratios) of the two case firms—perhaps in a table?

Question Four
In August/September 2023, analysts compared the prices of 23 basic grocery items across four of South Africa’s most popular food retailers: Woolworths, Pick n Pay, Checkers and Shoprite. Find a news report by Supermarket Retailer here.
Shoprite was revealed as the cheapest option. In this store, basic food would have cost the customers
R931.17 which is R34.60 less than the next cheapest retailer, Checkers. Of the 23 items compared, Shoprite had the best prices for 10 of them: bread, canola oil, eggs, bottle of water, milk, pasta, beef mince, potatoes, tomatoes and bananas.
On the other end of the spectrum, Woolworths was the most expensive. In this store, basic food would have cost customers R1,095.77 – R25.50 more than the next most expensive retailer, Pick n Pay, and R164.60 more than Shoprite.
However, of the 23 items compared, Woolworths had the best prices for five of them: sugar, white rice, Nescafe coffee, Lipton tea, and lettuce.
It should be noted that did not include Spar in its comparison. This is likely due to the fact that Spar is franchised, meaning prices and items can vary from store to store.
It’s also worth mentioning that Woolworths, Pick n Pay, and Checkers often target their products towards more affluent customers, meaning some of their products are more costly to source such as free-range and organic – while Shoprite targets the average South African consumer.
Are these enterprises comparable? Assuming they are, are they able to deal with a volatile and uncertain circumstance equally well? And, if you were a trustee of your employer pension fund, which one of these enterprises would you recommend represents a better proposition as a “long-term buy” pension fund investment option?

Answers to Above Questions on Financial Reporting

Answer 1: The main aim of this report is to perform an analysis of business models of Pick n Pay Clothing and Shoprite Holdings in South Africa. The business activities of both these organisations differ from each other such as in terms of store presence, online retail strategy and market positioning. In respect to Pick N Pay clothing, it has more than 277 clothing stores, 21 hypermarkets and 163 supermarkets. Contrary to this, Shoprite Holdings has only 19 outlets which is comparatively less than Pick n Pay.


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