INTEGRATED REPORT 2023

X

Office, which includes the Offspring brand, is an omni-channel retailer with a portfolio ...

View
OFFICE RETAIL PRESENCE

OPERATIONAL REVIEW: TRUWORTHS

TRUWORTHS

icon RETAIL PRESENCE

TRUWORTHS HAS CONTINUED TO FOLLOW ITS PROVEN STRATEGY OF CAUTIOUSLY EXPANDING TRADING SPACE, INTRODUCING NEW STORE CONCEPTS, RECONFIGURING STORES THROUGH OPTIMISATION OF BRAND PORTFOLIOS, MAXIMISING SPACE PRODUCTIVITY AND INVESTING IN DIGITAL COMMERCE.

795 stores
at period end
(2022: 785 stores)
24 new stores
opened across all brands
(2022: 15 stores)
33 stores
expanded, converted, consolidated or relocated
1.4%
increase in retail trading space
E-commerce
sales now equal to the sales of three largest Truworths stores combined
Truworths Emporium Re-imagined
store concept successfully launched

Retail trading space increased by 1.4% with the opening of a net 10 stores in the period following two years of slight space contraction.

South Africa’s power crisis intensified during the year which further disrupted retail trading patterns and impacted store operations. The Group spent approximately R40 million on backup power solutions to mitigate the impact of load shedding across its South African stores, with 87% of retail sales in Truworths covered by alternative power sources by the period-end. Currently an additional R14 million is committed for the 2024 financial period which will result in stores covering approximately 92% of the Group’s South African sales being covered by alternative power sources. The remaining stores either do not experience load shedding or have adequate natural and artificial lighting to be able to trade offline.

EXPANDING STORE PRESENCE

A total of 24 new stores were opened across all brands during the year. This includes Truworths Emporium (six), Identity (six), Office London (two), Loads of Living (two) and a further new store for each of Truworths Man, Fuel, Truworths Kids Emporium, Naartjie and YDE. Additionally three new Sync stores were opened, bringing the store base to 19.

The four remaining stores that were significantly damaged in the civil unrest in KwaZulu-Natal in July 2021 reopened in the second half of the year.

A further 33 stores were expanded, consolidated, converted or relocated. Stores that are refurbished are often reconfigured to maximise customer appeal with the addition of new brands and design concepts.

Fourteen under-performing stores were closed, including two where the trading space was allocated to other brands.

The store footprint in the rest of Africa was unchanged at 31, with all the stores located in southern Africa, being Namibia (12), Botswana (10), Eswatini (5), Zambia (2) and Lesotho (2).

The much-anticipated store of the future concept, the Truworths Emporium Re-imagined, was launched with the reopening of the remodelled store in the V&A Waterfront in Cape Town shortly after the end of the reporting period in July 2023. The new concept comprises a free-flowing and borderless interior where the brands are displayed in one connected space which is graphic, dramatic and engaging. Wide open entrances allow for ease of shopping with highly impactful focal displays that are changed constantly.

A new Truworths Kids Emporium concept was incorporated in the Truworths Emporium in the Greenacres Shopping Centre in Gqeberha with new store designs also being launched for Office London, Earthchild/Naartjie and Naartjie. Enhanced store design concepts were introduced for Context, Loads of Living and Identity larger format stores.

Truworths invested R300 million (2022: R222 million) in new store development and renovations, bringing the total amount invested in stores over the past five years to more than R1.2 billion.

GROWING ONLINE BUSINESS

E-commerce sales grew by 45% and are now equal to the sales of the three largest Truworths stores combined, accounting for 3.5% of total retail sales (2022: 2.6%).

All Truworths products and brands are available on the Truworths, Office London, Loads of Living and Identity e-commerce sites. Customers are able to shop with a single basket across all four sites. Together with the extensive Truworths store footprint, this creates an engaging omni-channel experience for customers to shop effortlessly in-store and on digital devices.

DEFINING THE FASHION COURT

Truworths aims to be positioned in the centre of the fashion court in all leading malls and recognised as one of the fashion anchor tenants. This also applies to stores on main streets and in towns where Truworths strives to be located at the heart of the fashion retail zone.

Enticing stores, exclusive brands and internationally styled merchandise, position Truworths as an appealing and aspirational destination for quality fashion apparel. Creative merchandise displays in wide window frontages showcase the latest fashion trends and are designed to entice customers into stores.

MULTIPLE STORE FORMATS

Truworths Emporium stores

Truworths’ 350 emporium stores house a portfolio of exclusive, market-leading brands. The store format encourages customers to cross-shop between the mainstream brands such as Truworths, Truworths Man and the speciality brands including Uzzi, Daniel Hechter, LTD, Earthaddict, LTD Kids, Earthchild and Naartjie. These brands, together with their sub-brands, retain their unique identity and ensure variety and a multiple lifestyle offering within the emporium.

The brands featured in each emporium depend on the size and location of the store. Following the expansion of the Truworths brand portfolio in recent years, four specialist emporiums are now offered within the greater emporium store: Truworths Ladieswear, Truworths Menswear, Truworths Designer Ladieswear and Truworths Kids.

Refer to Market-leading brand portfolio on page 71 for detail on the brands included in each of the emporium formats.

Emporium stores are located in central positions in shopping malls and generally have three to five entrances, with maximum shop frontage and windows showcasing the wide range of brands and merchandise.

Stand-alone only stores

Identity, Sync, Young Designers Emporium (YDE) and Office London operate from stand-alone stores and are not incorporated in emporium stores as they generally target a different customer profile to Truworths’ shoppers.

Identity appeals to the fashion-forward and valueconscious youth market, offering high fashion merchandise at affordable prices. Stores are vibrant, edgy and fun to appeal to younger customers.

Sync targets the value segment of the fashion market with an aspirational offering for young men and women, with good quality at competitive prices in a vibrant, energetic store environment.

YDE showcases the fashion of emerging and well–established South African designers and targets young, fashionable customers wanting designer labels and styling. The store design is a strong point of differentiation from competitors.

Office London is the South African offering of the Group’s UK fashion footwear brand Office. The brand operates stand-alone stores in central positions in shopping malls, often adjacent to the Truworths Emporium. The Office London stores are modern, light and energetic and are located in the top retail locations in South Africa.

RETAIL PRESENCE IN 2024

Trading space is expected to increase by approximately 2% in the 2024 financial period with continued new store openings and renovations, as well as consolidation of trading space to improve trading densities and the closure of under-performing stores.

The flagship Truworths Emporium Re-imagined design will be extended to a limited number of carefully selected stores throughout the country.

Outside of South Africa, new Truworths and Identity stores are planned to be opened in Botswana.

Capital investment of R286 million has been committed to store development for the 2024 financial period.

INTEGRATED REPORT 2023