Woolworths (South Africa)

Woolworths Holdings Limited
Corporation
Industry Retailing
Founded 1931
Founder Max Sonnenberg
Headquarters 93 Longmarket Street, Cape Town, South Africa
Area served
 South Africa
Mauritius
Key people
 Ian Moir (CEO)
Simon Susman (Non-executive chairman)
Products Clothing, footwear, accessories, groceries, beauty products, homeware and financial services.
Revenue Increase R75.2 Billion (2018)[1]
Increase R5.59 Billion (2015)[1]
Increase R3.12 Billion (2015)[1]
Number of employees
 18,563 (South Africa only)
Divisions Woolworths (Proprietary) Limited
Country Road (Australia)
David Jones (Australia)
Woolworths Financial Services
Website www.woolworthsholdings.co.za
woolworths.co.za
Woolworths store in Somerset Mall, showing the current branding.
Woolworths food store in Johannesburg, showing the old branding.

Woolworths Holdings Limited (JSE: WHL) is a South Africa-based multinational retail company that owns the South African retail chain Woolworths which also runs as the leading retail chain in Australia, and Australian businesses David Jones and Country Road Group.

The South African business was originally modelled on Marks & Spencer of the United Kingdom.[2] This relationship with Britain's Marks and Spencer was formed after the Second World War, which led to the retailer buying all of the unissued share capital of Woolworths in 1947. These shares were later sold, but close ties still remain.[3] The first Woolworths store opened in The Old Royal Hotel in Cape Town in October 1931. It was founded by Max Sonnenberg assisted by his son Richard and Fred Kossuth.

The South African Woolworths business consists of full-line fashion, beauty and home stores, many of which incorporate a premium food retail offering. Stand-alone food stores and "Food Stops" re attached to Engen petrol stations are also located in urban areas". Woolworths operates 217 full line stores and 421 food stand alone stores in South Africa and 65 stores throughout the rest of Africa. Woolworths sells clothing and accessory items under a number of premium brands, namely Studio W, RE: Country Road, Witchery, Mimco and Trenery.

History

Founded by Max Sonnenberg and his son Richard, Woolworths South Africa first opened its doors on 30 October 1931 in Plein Street Cape Town, in what had been the stately dining room of the famous Royal Hotel. While Sonnenberg had no affiliation with Woolworths in Britain, Germany, North America or Australia, his plan was to develop a chain of stores based on Woolworths Australasia Ltd.

A pivotal point in Woolworths' history came after World War II, when the company established its relationship with Marks & Spencer (M&S) of London. Sonnenberg and Sir Simon Marks, son of the M&S founder, became good friends which led to M&S buying shares in Woolworths in 1947. Later, David Susman, son of Max Sonnenberg's business partner Elie Susman, married Ann Laski, Lord Marks' niece. David Susman became a non-executive director of M&S, a position he held for nearly 30 years. Although M&S ultimately sold its shares of Woolworths, the two companies maintained close personal ties.

Woolworths merged with Truworths in 1981 to form the Wooltru Group. Over a twenty-year relationship the company underwent much change and transformation that significantly improved sales and profits, before it was unbundled from the group in 1997. In 1998, the company bought a controlling interest in Australian clothing retailer Country Road.[3]

Simon Susman, David's son, became Chief Executive of Woolworths in 2000.[4] David Susman died on 11 May 2010 at the age of 84. Simon Susman retired from his post as CEO at the end of 2010.[4]

In 2014, Woolworths acquired Australian department store David Jones for $2.15 billion.[5][6] with Country Road CEO Iain Moir succeeding Paul Zahra as chief executive.[7] Following the takeover, Woolworths sold the iconic 1938 Market Street store.

Controversy

Christian magazines

In October 2010, Woolworths came under fire as they opted to remove Christian magazines from their shelves and discontinue their sale. This was met with a huge outcry from the Christian community, many voicing that they would boycott the chain store.[8] Their Facebook fan page was flooded with opinion, both positive and negative. Woolworths maintained it was strictly a business decision, with CEO Simon Susman attributing their decision with the diminishing number of sales for these magazines; "We are currently reviewing all magazines sold by Woolworths. We will continue to remove magazines from our shelves that aren't popular with clients. We aim not to offend any community by this policy" said Susman regarding the decision.[8] However, Woolworths vowed to put the five Christian magazines back on its shelves, following a public outcry over the withdrawal of the titles.[9]

Soft drink imitation

In early 2012 the South African Advertising Standards Authority ruled that Woolworths' vintage cold drink range was an imitation of Frankie's Soft Drinks range. It was ruled that Woolworths intentionally copied the phrase "Good Old Fashioned Soft Drinks" to promote its own line of beverages thereby infringing on the rights of Frankie's Soft Drinks. Woolworths agreed to remove the range immediately.[10] After the event Woolworths South Africa's CEO Ian Moir publicly stated that "Public opinion is so much against us and, whether we're right or whether we're wrong, customer opinion is against us."[11]

Affirmative action

In September 2012 Woolworths was accused of racism by some groups[12] for allegedly discriminating against white job applicants and staff. The accusations followed after claims that the retailer's advertising on their career site said its jobs are only open to "African, Coloured and Indian" candidates.[13] Shortly after the incident, Woolworths changed the advert text to say "In accordance with Woolworths' Employment Equity approach, preference will be given to candidates from designated groups".[12]

Plagiarism

In October 2013 rumours of plagiarism surfaced when Euodia Roets, a South African artist, accused Woolworths of using her designs that were kept as samples after contract negotiations failed.[14] In her article Euodia Roets shows illustrative images of her design and compares it to a cushion later sold by Woolworths on which a strikingly similar design was used. Woolworths denied these allegations on their website.[15] In her allegations Euodia Roets also claimed "If that text is in fact from Wikipedia, Wiki requires attribution on all commercial use of their text. You'd be correct in assuming Woolies did no such thing.". The text used on the design is an exact match of portions of text lifted from Wikipedia's Hummingbird article, without attribution, in violation of its Creative Commons License. When pressed on the matter, the official Woolworths South Africa Twitter account opined that "We've checked with our lawyer; Wikipedia does not own the content."[16]

See also

References

  1. 1 2 3 "Woolworths Annual Report 2015" (PDF). Woolworths Holdings Limited. 2015. Retrieved 5 December 2015.
  2. ↑ David B. Yoffie (7 October 1997). "Higher Education" Harvard Business Publishing
  3. 1 2 "Enabling all Africans to invest in stock markets". Moneyweb. 2017-05-04. Retrieved 2017-08-30.
  4. 1 2 "Woolworths' CEO resigns". m.news24.com. Retrieved 2017-08-30.
  5. ↑ "Myer response to David Jones announcement". ASX-Media-Release, Australia. 9 April 2014. Retrieved 15 April 2014.
  6. ↑ "David Jones Board Recommends A$4.00 Cash per Share Proposal". ASX-Media-Release, Australia. 9 April 2014. Retrieved 15 April 2014.
  7. ↑ Speedy, Blair (12 August 2014). "Iain Nairn to head David Jones as Paul Zahra quits". News Corp Australia. The Australian. Retrieved 12 August 2014.
  8. 1 2 "Woolworths bans Christian mags". News24. Retrieved 2017-09-03.
  9. ↑ Woolworths repents – Times LIVE
  10. ↑ Peters, Sherlissa (2 February 2012). "Woolworths to remove entire soft drinks range". iol. Retrieved 6 June 2012.
  11. ↑ Nicolson, Greg (1 February 2012). "Frankie's vs. Woolworths: Good old-fashioned David-and-Goliath battle". Daily Maverick. Retrieved 6 June 2012.
  12. 1 2 Peter Church (3 September 2012). "Racist Woolworths SA defiant". SA Promo. Retrieved 14 January 2013.
  13. ↑ Fadia Salie (4 September 2012). "Woolworths douses racial fires". News 24. Retrieved 14 January 2013.
  14. ↑ Pedeboy, Delphine (21 October 2013). "Copyright, credit, Woolworths and the hummingbird". Ground Up. Retrieved 26 July 2016.
  15. ↑ Cushion Design Allegation
  16. ↑ "Woolworths South Africa Twitter". Twitter. Retrieved 22 October 2013.
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