Woolworths reshapes strategy around Food as retail pressure mounts

Johannesburg – Woolworths is sharpening its focus on its Food business as changing consumer spending patterns and tougher trading conditions put pressure on parts of the retail group.

According to Daily Investor, Woolworths has identified Food as its strongest competitive advantage and is reorienting the group around the business while seeking to improve the performance of its other divisions.

Woolworths Food delivered 5.7% growth in turnover and concession sales for the 52 weeks to 28 June 2026, while comparable-store sales increased 3.7%, according to the group’s annual results.

CEO Sam Ngumeni said the performance reflected the resilience of the business but acknowledged that there was still room for improvement.

“While our results reflect the resilience of our portfolio and the strength of Woolworths Food, it is not where we want to be,” Ngumeni said, according to the report.

He said the company was moving to unlock greater value across the group.

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“We are clear on the opportunities and the actions required to unlock greater value, and we are moving decisively to improve performance across the Group.”

The shift comes as consumers remain under pressure from higher living costs and subdued confidence. Reuters reported that Woolworths’ annual headline earnings per share increased 5.3% to 282.3 cents, while group turnover and concession sales rose 4.3% to R84.5 billion.

Food has also benefited from rising online demand. Woolies Dash revenue increased by 19.6%, with online sales accounting for 7.3% of South African Food sales during the financial year.

By comparison, the group’s Fashion, Beauty and Home division recorded 4.4% growth for the full year, while its second-half growth slowed to 2.6% amid weaker consumer demand and increased promotional activity.

Identity

The competitive environment is also intensifying. The report said that Shoprite’s annual sales increased 7.2% to R270.8 billion, with its South African supermarket business growing 7.1%. Shoprite said consumers were increasingly seeking value, with the retailer keeping selling-price inflation at 0.8%, below South Africa’s 3.9% food inflation rate.

Ngumeni said Woolworths’ premium food offering remained central to its identity.

“Woolies always stood for quality, innovation, and sustainability. At a Woolworths brand level, the one part of our business that best represents that is food.”

The company is therefore seeking to use Food as a benchmark for the rest of the group while continuing to address weaker-performing businesses.

The latest figures suggest that Woolworths Food remains a growth driver, but the retailer is operating in an increasingly competitive market where consumers are becoming more focused on value and essential purchases.

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