Some alternative points by Polly:
"Some alternative views :
1. All the talk of Pepco or Milo whatever etc...Increasing stores does not mean higher bottom line. Chasing turnover does not mean bigger profits
In todays recessionary times most of the established retailers throughout the world are restructuring , closing down stores retrenching staff , moving from high rental areas to cheaper rentals etc. Opening in HIGH Street means astronomical rentals to be paid. Not a very clever idea especially when you work on a small markup targeting budget lines and customers.
I disagree here Polly, in the news article they mention that like for like sales have increased by 7%. So financially it does make sense to open new stores. With the new stores they have managed to up their revenue with 14%. For european standards thats an exceptionally strong increase which shows that the business is performing well.
2. Talk in PS thread of Pepkor USA and Europe.. ok Europe is on the road and expanding but see 1 above. Now has the South African retail model ever worked elsewhere in the world for any of our retailers? Ever? Show me one successful one? Just one... More hope i say.
Pepkor USA was an idea put out not a fact that Steinhoff will ever do this.
3. One post " The reason I am invested in SNH is for the Pepkor Europe there are 500 mil people in the EU 10 times more than in SA
so Pepkor Europe will become much bigger than Pepkor SA!" So if Shoprite goes to India or China where their population is 500 times more than South Africa will you invest in Shoprite on that basis? Why is Shoprite not going that route?
Good point by Polly, however you have forgotten to mention that the crux of expanding into a new country is to get passed government to get the licenses etc. Pepkor Europe is established in this market and thus a a way bigger customer base in Europe then in SA. So it is a valid point to say that europe has more potential customers.
4. and i love the "Cleanest AFS" and " one of the Strongest retailers in the Worls" part.....More hope or a non event? or fact or fiction? getting carried away boys TOTALLY!!!"
Well this will be a discussion point as it cannot be proved who has the cleanest AFS, however you can be sure that Steinhoff AFS are double checked by everyone lol. (Hawks, Auditors, Advisors, Investors etc)
Thank you Polly for the Tekki Town article. Interesting tho that they are only talking about the legal costs which need to be paid by Pepkor SA. Do you know how much these were?
