Top South African food retailer closed stores across South Africa and is now ready for a new chapter

Pick n Pay has closed many supermarkets across South Africa as part of its store estate reset strategy to address underperforming sites.

This has helped the retailer to reach a turning point where it can now move beyond restructuring toward operational recovery and growth.

The store closures started three years ago as part of Pick n Pay’s turnaround strategy to save the struggling retailer.

At the time, Pick n Pay was heading towards bankruptcy, reporting record losses and mounting debt, and stating that it had become technically insolvent.

The new CEO, Sean Summers, unveiled a turnaround plan, which included a rights offer, selling part of Boxer, and closing poorly performing stores.

The retailer successfully raised R12.5 billion through a rights offer and the Boxer initial public offering (IPO) in the 2025 financial year.

Earlier this year, he followed it up with an additional R4.7 billion capital raise through a subsequent sale of Boxer shares.

This money wiped out most of the debt, strengthened the balance sheet, and gave it funds to execute its turnaround strategy.

A big part of Summers’s plan was focusing on minimising the losses incurred by specific loss-making company-owned stores.

These poorly performing supermarkets were either closed or converted to Pick n Pay franchises or Boxer stores.

In the 2025 financial year, 25 Pick n Pay stores were closed, 7 converted to franchises, and 8 converted to Boxer stores.

In the 2026 financial year, Pick n Pay closed 39 company-owned stores and 69 franchise stores, continuing its store reset plan.

In addition, 42 stores were removed from the Pick n Pay brand via conversions to other formats like Boxer or different owners.

Pick n Pay ready for a new era

Pick n Pay CEO Sean Summers recently said they have completed most of their store estate reset programme and are shifting their focus to expansion and modernisation.

Pick n Pay now has 23 company-owned hypermarkets, 285 supermarkets, 419 clothing stores, and 265 liquor shops.

Its franchisees now have 211 supermarkets, 7 markets, 190 express locations, 18 clothing stores, and 194 liquor shops.

Summers said the retailer is now expanding again, with plans to open 8 new stores across South Africa this financial year.

The company is also modernising its existing stores to enhance its service offerings and compete more effectively in the market.

“We’ve got a whole lot of refurbishments that are going ahead. We are also looking to get back onto the expansion trail again,” he said.

The retailer forecasted a net capital investment of R2.6 billion across the group for the 2027 financial year.

Pick n Pay is set to account for R1.4 billion of this total investment, nearly double the R800 million spent in 2026.

Summers explained that Pick n Pay’s new stores will be more compact, with the retailer ideally looking for locations that are between 2,300 and 2,500 square meters.

This will ensure Pick n Pay’s rents and rates are kept in check, and also align better with modern shopping trends.

Discovery Bank and Visa’s latest SpendTrend26 report showed that grocery shopping frequency in South Africa has increased by nearly 40%.

At the same time, the average spend per basket has declined by 8%. This shows that households are making more frequent trips to the store but buying smaller baskets.

Summers’ plan to make future Pick n Pay stores more compact should help the retailer better align with these changing consumer habits.

“Our stores are going to be more compact going forward into the future. With the cost of stores in both rent and rates, it’s important that they are built the right size,” he said.