Groceries a family affair for new CEO

Spar ’s Botten finds retail ‘dynamic, exciting and fun’

Spar, which reported a 30.3% drop in earnings for the six months to March, says arbitration would result in a fair outcome for both parties.
Spar, which reported a 30.3% drop in earnings for the six months to March, says arbitration would result in a fair outcome for both parties. (Freddy Mavunda)

For Spar's new CEO, Brett Botten, the passion for food retailing runs in the family, with his mother having worked for more than 20 years for rival Pick n Pay while he was growing up in the Eastern Cape town of Kariega (formerly Uitenhage).

In his first interview as CEO of the group, Botten, who is a qualified chartered accountant and has spent 26 years of his working life with Spar, says the fact that his mother, Phoebe, had been involved in the grocery business for so long definitely played a role in shaping his own interest in food retail.

"I guess food retail has been in our family for a long time," says Botten, who started his new role on Monday this week.

Botten says his mother, who is retired, had a good career at Pick n Pay and the company had been good to her. However, nowadays her loyalty is a "bit torn", he quips.

Botten says he always "liked the idea of retail as it's dynamic, exciting and fun".

"As far as FMCG [fast-moving consumer goods] are concerned, people have to eat and drink, so also it's quite a safe business to be involved in and I suppose that is a bit of the accountant in me coming through there."

Botten, who did his articles at Deloitte, also did a three-and-a-half-year stint at automotive component group Hella, which along with Volkswagen and Goodyear is based in Kariega.

He joined Spar in 1994 and from his first interview felt "that there was something very special about Spar's culture".

"It was just the feeling I got about the place, that people mattered, and I liked what the brand stood for. I took the job and as I got more and more involved, I found it a special environment to work in. It's a values-based business."

Spar holds its own both at the top end and at the bottom end of the market

He says the organisation is built around servicing the independent retailers that form part of the Spar guild and that it is part of the group's culture to "be humble in our approach".

The group operates on a voluntary trading model and Spar store owners - most of whom are independent - are not obliged to buy products from its distribution centres, but can source from other suppliers.

"One of our values is 'family', and that is something we stand by, especially when we are dealing with our retailers. Most of our people don't leave. I've been here for 26 years. We have a lot of people that have come in and stayed because it is such a good environment."

Botten, who has headed up several of Spar's divisions, says because of its structure, the company cannot afford to be complacent.

"We have to continuously look after the wellbeing of our retailers, their growth and profitability. Their success is our success. Those are things we think about a lot, how to make sure they remain profitable and on a growth trajectory."

Although Spar has become one of the biggest retailers in SA, it was built off a small business format and has "managed to hang onto the small business feel" in terms of its relationships with its suppliers and retailers.

He says this small business feel to Spar is probably what appealed to him at the time he joined.

"I am a small-town guy and I often think back to my days growing up, and I'm very grateful to Muir College [where he was schooled in Kariega]. It was a great school and it still is a great school. I will never forget where I come from. I'm just a normal, Eastern Cape boytjie and I'm very proud of that."

Looking ahead, Botten says the retail landscape will remain very competitive, which will be good for consumers in terms of choices available.

Spar "holds its own, no question, both at the top end and at the bottom end of the market".

"The competitors here are strong. Even with Walmart coming into the country all those years ago [when it acquired Massmart], I think that they would have realised that the landscape in South Africa has a number of strong competitors.

"As to who is growing market share, I'm not sure. I think restaurants are still struggling and people are skittish about going out to restaurants and I think all of us have taken a bit of share away from restaurants."

However, there is "no doubt that consumers are under big pressure". He is concerned about high unemployment, which has worsened during the pandemic.

"We are worried about the health of the consumer. There have obviously been the additional government grants and all the relief that has assisted significantly, but that is now drying up."

He was pleased with the government moving the country down to lockdown level 1 and allowing normal trading hours at weekends for liquor outlets, saying that the alcohol bans and trading-hour restrictions had hampered growth at Spar's Tops brand, which has 842 outlets in SA.

"The large footprint of Tops liquor stores near Spar stores highlights the strength of the Tops brand in attracting weekend shoppers to our stores because of the convenience of a 'one stop' shop."

Botten says this makes him optimistic that Spar will "see an uptick in our sales numbers as we move forward with full trading allowed".

As far as empowerment at Spar is concerned, Botten says the group is working hard to "recruit good candidates" and "fast-track talent" within the company.

At board level, half the directors are black, and nearly a quarter of senior management in SA are black, up from 20% a year ago.

Spar has also invested heavily in enterprise development in respect of both independent retailers and suppliers, Botten says.

Spar has developed a successful rural hub based in Limpopo, where 15 farmers, including three women, sell produce to the group.

"It's a very positive venture for us," he says.