Spar is the runt of the litter

Spar is by far the worst-performing grocery retailer in 2026 based on share price performance, as the company struggles to solve long-standing issues in its business.

Anchor Capital investment analyst Stephan Erasmus said one of the most important things for Spar to get right is rebuilding trust with its independent store owners.

Erasmus said the recent resignation of Spar’s chairman, Mike Bosman, and deputy chair, Shirley Zinn, is a step in the right direction, but more work still needs to be done.

The two chairs came under pressure in May 2026 when Spar’s independent retailers petitioned its board to remove Bosman and Zinn.

Initially, the board declined to do so, but on 17 August 2026, Spar announced that both Bosman and Zinn had resigned from their positions with immediate effect.

“The nominations committee is now recruiting directors against a skills matrix that specifically includes direct retail and independent retailer experience,” Erasmus said.

This, he said, suggests that Spar recognises the need for greater expertise in these areas. 

However, while the board shake-up may be a step in the right direction, Erasmus said that appointing a chairperson who commands the confidence of Spar’s store owners remains critical. 

“Ultimately, the relationship between Spar and its independent store owners is fundamentally symbiotic,” he explained.

Unlike South Africa’s other three major retailers, Woolworths, Pick n Pay, and Shoprite, Spar operates more as a warehousing and distribution business than a traditional retailer.

Whereas Pick n Pay and Shoprite have a mix of corporate and franchise-owned stores, and Woolworths owns all of its stores, Spar operates exclusively through franchisees.

The company holds several country licences for the Spar retail brand, which is used by a network of independent retailers who trade under it.

These independent retailers are then supplied on a voluntary basis through Spar’s distribution centres.

This model means that Spar and its independent store owners have a symbiotic relationship whereby both benefit from their association.

This is why, Erasmus said, it is critical that Spar rebuilds trust with its retailers, with this being the key to restoring the business to a sustainable footing.

Spar lags

Erasmus explained that SPAR arguably finds itself in a precarious operating position without the luxury of time. 

2026 has not been a good year for retailers so far, but Spar’s stock has been the worst-performing among South Africa’s four major grocery retailers in the year to date.

Among the top four, Shoprite is the only retailer whose share price has risen, up 9.5% since January 2026.

Woolworths and Pick n Pay are fighting for second place, with their share prices down 21% and 24%, respectively.

Spar is the worst performer by far, with its share price having plunged 57% since the start of 2026.

The most recent dip in Spar’s share price came after the retailer reported that its South African operating profit fell materially in the first half of its 2026 financial year.

At the same time, a growing proportion of amounts owed to the Spar Group by retailers is overdue, which Erasmus said is unsurprising given the status quo. 

“The Spar balance sheet provides little room for further execution missteps, with South African leverage approaching its covenant limits and the dividend suspended,” he said. 

To fix its relationship with independent store owners, and consequently its financial health, Spar has a lot of work to do.

Independent store owners’ trust in Spar took a significant knock in recent years, largely due to its botched implementation of SAP software at its KwaZulu-Natal distribution centre.

“The well-publicised SAP software implementation challenges have not helped its cause, with the rollout still incomplete and remaining a material execution risk,” Erasmus said. 

Therefore, completing this rollout successfully is critical if Spar wants to win over its independent store owners and investors.

In addition, Erasmus said Spar needs a credible board reset and evidence of a sustainable recovery in its South African business.

This, he said, could make the retailer a more attractive investment opportunity. Until then, Anchor Capital will remain on the sidelines.

Retailer	Starting share price on 1 January 2026	End share price on 20 August 2026	YTD Return
Shoprite	27191	29716	9.29%
Woolworths	5613	4425	-21.17%
Pick n Pay	2460	1880	-23.58%
Spar	9492	4058	-57.25%