Appetite for gourmet food delivers good results for Woolworths

Customers remain loyal to Woolies’ food offerings and their pets are getting spoiled too. By Kara le Roux

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There are indulgences and then there are 8kg prosciutto hams that cost R9,999 each. Woolworths has imported 250 of them from Italy, of which 40 have already been sold, complete with knife and chopping board.

Woolworths chief executive Roy Bagattini tells of one particular request from a customer last week. “I got an email from a customer who said, ‘Mr Bagattini, I'm writing directly to you. It’s my husband’s birthday. I need to give him something super special. I want the R10,000 ham. Can you please help me? I don’t know where to get it.”

The ham, he adds, was delivered to the customer that same afternoon.

Some consumers, however, have been hamming it up on social media. Although the prosciutto has raised eyebrows and led to laughs of disbelief in some income groups, it does prove the point of a brand chasing loyalty in the premium lane.

The group's turnover rose 6.1% to R81-billion this financial year, but its profit before tax fell 14.4% to R3-billion. Earnings per share slipped 1.4% to 273.4 cents and dividends per share fell 29% compared with the previous year.

With the focus on revamping and redesigning its brick-and-mortar stores, the company has embraced South Africa’s shopping culture.

“As South Africans, I think it’s in our culture that people still want to touch and feel, still want to come in and connect, still want to go on a little outing,” says Lindiwe Khumalo, Woolworths’ head of store design.

The result has been Woolies’ investment in “next generation” stores, the first of which is the newly revamped Tyger Valley branch. A proud Bagattini calls it “probably close to being the best in the country” in all categories, from food to fashion.