INSIGHT-South African supermarket giants in fine food fight

Mon Jun 19, 2017 12:37pm GMT

* Discounter Shoprite drives hard into upmarket niche

* Sets stage for a turf war with rival Woolworths

* Low-income shoppers cut back as recession hits

* But spending of wealthy has held up in downturn

By TJ Strydom

JOHANNESBURG, June 19 (Reuters) - As South Africa slides into recession, and households have less and less to spend, the number one supermarket group Shoprite is adopting an unlikely strategy: it's pushing upmarket.

While the lower-income families that have long been its core customers cut back, the spending of the wealthier class remains undented by the downturn.

In a bid to retain its leading industry position, the discount retailer's new boss is driving hard into the upmarket, higher-margin niche dominated by rival Woolworths.

The stage is set for a turf war to win the hearts, minds and wallets of South Africa's richest 2 million households - and ultimately preeminence in the supermarket sector.   Continued...

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