SPAR expands with high-end grocery chain in South Africa

SOUTH AFRICA – South Africa’s SPAR Group is preparing to introduce a chain of upscale grocery stores, with the first expected to open in the final quarter of this year.

The move is part of a broader strategy to attract wealthier customers in a market that is becoming increasingly divided by income levels.

“The strategy includes converting high-end niche SPAR stores while also opening new locations in strategic sites. We anticipate around 30 to 40 Gourmet stores in the future, though no fixed timeline has been set,” Max Oliva, SPAR Southern Africa CEO, told Reuters.

The retailer, which operates several SPAR country licenses under the Dutch SPAR group, aims to place these luxury stores in high-income residential and urban areas.

The new SPAR Gourmet brand will focus on offering premium food options, high-quality coffee, fresh bakery items, and indulgent products.

“Key focus areas include premium food solutions, coffee, bakery, and indulgent products, with a curated assortment tailored to meet the needs of a more affluent customer base,” Oliva said.

This strategy aligns with the company’s ongoing efforts to sharpen its market segmentation, a trend seen among major competitors like Pick n Pay and Shoprite.

The move mirrors developments in South Africa’s grocery sector, where retailers are increasingly designing stores for either high-income or low-income consumers to remain competitive.

Competition in the grocery market

South Africa’s higher-end grocery sector is largely dominated by Woolworths, with Shoprite’s Checkers chain following closely behind. Meanwhile, the discount grocery space is led by Shoprite’s Usave and Pick n Pay’s Boxer stores.

To maintain a strong presence in both segments, SPAR is also planning a revamp of its SaveMor discount chain. This approach reflects the company’s strategy to cater to customers across different economic groups.

The SPAR Group has been a significant player in the South African retail sector since its establishment in 1963.

Operating under various formats, including SPAR Supermarkets, SUPERSPAR, KWIKSPAR, and SPAR Express, the company continues to expand its presence across the country.

SPAR Gourmet is expected to bring a fresh approach to high-end grocery shopping, offering an upgraded shopping experience tailored to a select customer base.

While the company has not provided a definitive timeline for the full rollout, the first store’s launch later this year will mark a key step in its expansion strategy.

Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.