New ultra-luxury Woolworths in South Africa can lose R200,000 a week because of an approval problem

Woolworths’ flagship Food Emporium at Dainfern Square could lose R200,000 in weekly sales due to its struggle to secure final approval for its liquor store.

The new Dainfern Square store was unveiled in August 2026 as the first Food Emporium in Gauteng.

It brings together the retailer’s broadest food offering, including premium ingredients, specialist counters, and prepared meal options.

It features expanded bakery, fishmonger, and butcher counters, a specialist cheese counter, a daily sushi offering, and a What’s Cooking Bar. The store also has a larger pantry and refreshed florist.

Woolworths Food CEO Chan Pillay said the concept responds to customers seeking quality, greater choice, and new meal ideas.

The retailer first introduced the Food Emporium concept in Durbanville, Cape Town. The Dainfern opening marked its expansion into Gauteng.

However, the premium retailer now faces an uphill battle in gaining final approval for its liquor store, which could result in Woolworths losing hundreds of thousands of rands.

The retailer’s WCellar outlet was not operating when the premium food store opened in August 2026. This was due to delays in the approval process for its liquor licence.

Woolworths applied for the licence in 2022 and received conditional approval from the Gauteng Provincial Liquor Board.

However, the approval was subject to conditions, including the submission of photographs of the completed store and a subsequent site inspection.

Construction of the Dainfern store only began in March 2026. Before its opening, the Liquor Board informed Woolworths that its provisional licence had lapsed and that it would need to submit a new application.

Woolworths subsequently approached the Gauteng High Court for an urgent interdict allowing it to sell alcohol while the final licence approval process continued.

The court granted the interdict, allowing the Dainfern WCellar to operate, provided it complies with all relevant regulations. The ultimate decision on the licence remains outstanding.

The court also ruled that a punitive costs order was justified in the first part of the case. This means the Gauteng Provincial Liquor Board must pay Woolworths’ legal fees.

Woolworths could lose R200,000 every week

A key consideration in granting the interdict was the financial impact of keeping the liquor store closed.

The WCellar at Dainfern Square is expected to generate annual turnover of R10.4 million. This equates to R200,000 in weekly sales.

“It projects annual gross turnover of R10.4 million, equating to approximately R200,000 per week in foregone sales,” the High Court said.

The court also noted that the losses would be permanent, as customers could take their liquor purchases to competing retailers.

“Each week that the applicant cannot trade, it suffers permanently lost revenue and customer diversion to competitors.”

Woolworths also argued that the liquor store’s absence affected the launch of its flagship Food Emporium. The court recognised that the launch was a once-off commercial opportunity that could not be repeated.

“The launch momentum of the Food Emporium, a flagship development, is a discrete and unrepeatable commercial event,” it said.

The court further found that the harm flowed from the Liquor Board’s failure to finalise an application that had already received conditional approval.

The dispute is particularly significant given the scale of Woolworths’ investment in its new food format.

South Africa’s biggest retailers bet big on liquor stores

Liquor stores, such as WCellar, are becoming increasingly important to South Africa’s major grocery retailers.

Shoprite, Checkers, SPAR, Pick n Pay and Boxer have all expanded their liquor store networks as they compete for a share of the country’s off-trade liquor market.

According to Trade Intelligence, this market grew by 4.2% in 2025 to reach R109 billion.

South Africa’s largest retailer, Shoprite, had 926 liquor stores in its 2026 financial year. This consisted of 574 Shoprite LiquorShops and 352 Checkers LiquorShops.

SPAR followed with 897 outlets, including 879 TOPS at SPAR stores and 18 SaveMor Liquors. Pick n Pay had 549 liquor stores, while Boxer had expanded its network to 202 outlets.

Boxer has made liquor stores a priority in its expansion strategy, aiming to open one alongside each new grocery store.

In its 2026 financial year, 58% of Boxer’s stores had an accompanying liquor outlet. This increased to 64% in the first half of its 2027 financial year.

In an interview with Daily Investor in October, Boxer CEO Marek Masojada stressed the importance of this category to retailers in the country.

He explained that South African law requires retailers to operate a separate store to sell most alcoholic beverages, rather than placing them on the main grocery floor.

This creates an opportunity to attract customers who want to buy groceries and liquor on a single shopping trip. “That’s what we’re after: convenience. Customers want to do both at the same time,” Masojada said.

He also noted that this segment is a significant contributor to Boxer’s turnover and our profitability at the moment.

“It gives you another category where you can utilise the overhead of having a store with bigger turnover, because although they’re two separate shops, the infrastructure behind it is the same.”

Liquor can also offer retailers higher margins than food and groceries. Otto1890 senior equity analyst Alec Abraham recently told Daily Investor that it is a higher-margin business compared with traditional grocery retail.

However, the margins vary depending on the products sold. Masojada said Boxer focuses on high-volume, lower-margin products such as beer and spirits, rather than more expensive wines.

“In our world, it’s quite a tough business because we don’t sell fancy wines where you make huge margins,” he said.

Masojada added that theft and other operating challenges also put pressure on this category.

“But it’s a very important part of our business, and it gives us another growth lever. When other parts of our business are growing more slowly, we’re very thankful to have the liquor component,” he said.

The market’s size and fragmented structure also give retailers room to expand their market share.

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Photos of Woolworths Food Emporium at Dainfern Square

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