Major retailer rolling out stores and coming for the top spot in South Africa

Mr Price has significantly grown its market share in South Africa over the past year, growing its share by over R300 million.

The retail giant, which owns well-known brands like Mr Price Home, Mr Price Sport, Miladys, Yuppiechef, and Studio 88, recently released a trading update for the 13 weeks ended 28 June 2025.

This period marks the first quarter of Mr Price’s 2026 financial year, which has seen the retailer grow sales by 11.6% in April and May 2025. This resulted in market share gains of 20 basis points.

The company explained that this performance was partly driven by the timing shift of Easter holidays into April.

The retailer also received a boost from strong sales growth in May due to a timely Winter season, especially considering the same month in the prior year provided a lower base as consumers restrained their spending pre-election.

However, this momentum did not continue into June 2025, as retailer sales decreased by 5.1%. The company explained that this was an industry-wide trend in June.

In addition, Mr Price recorded a far stronger performance in June 2024, with sales growth of 12.7%, providing a high base to compare June 2025’s performance to.

While the retailer expected this slump in June 2025, it explained that the shift in school holidays from the last two weeks into July had a greater impact than expected.

This timing required Mr Price to implement higher markdowns on products, which was observed across a highly promotional sector. 

This was a significant factor in Mr Price’s first-quarter gross profit margin decreasing by 20 basis points. 

However, the retailer expects its first-half gross profit margin to remain in line with the prior year and said it exited the winter season clean and is comfortable with its closing stock position.

In the first quarter, Mr Price’s South African retail sales grew 6.0% to R8.3 billion and comparable sales increased 2.6%. Non-South African corporate-owned store sales increased 10.4%. 

The retailer’s total store sales increased 6.3% while online sales increased 7.6%. Mr Price noted that online sales contribution grew to 2.4% of total retail sales during the period, with particularly strong growth in the Homeware segment.

Mr Price’s store footprint increased by 31 stores, and the retailer’s total footprint expanded to 3,061 stores. Trading space increased 3.7% on a weighted average basis.

In addition, the company recorded market share gains of 10 basis points during the first quarter as it outperformed the total comparable market’s retail sales growth.

Despite the slump in June 2025, Mr Price said July is off to a better start, as the first three weeks of the month saw retail sales grow by 12.9% at an improved gross profit margin.

Outlook

Looking forward, Mr Price said it is faced with a difficult operating environment, but remains optimistic about its growth prospects.

The retailer explained that, since the start of 2025, global and local business conditions have been disruptive due to uncertainty around tariffs imposed by the United States.

“This has hindered broader economic recovery and continues to cloud the prospects for sustained local growth, as indicated by the reported GDP growth of 0.1% for Q1 2025,” Mr Price said.

Locally, operating conditions are also difficult, with volatility in South Africa’s economic landscape making the outlook for the year, and particularly consumer spending, tough to predict.

The retailer noted that short-term relief measures of low inflation and interest rates will provide a boost to consumers. However, these factors intersect with an increasingly firm second-half base due to two-pot retirement inflows in 2024 and rising food and fuel prices.

“Despite this, the group remains optimistic that it can continue to achieve margin accretive market share gains,” Mr Price said.

“Sharp focus remains on driving consistent performance by its key growth vehicles in the Apparel and Telecoms segments, while the strategic improvements made on strengthening the Homeware segment have delivered positive progress.”