Woolworths Food’s big plan in South Africa

Woolworths CEO Sam Ngumeni said they are addressing their supply problems to ensure they have enough high-quality products to meet demand.

Ngumeni shared these details during an analyst presentation webcast following Woolworths’ financial results for the year ended 28 June 2026.

Woolworths’ turnover and concession sales increased by 4.3% to R84.5 billion, with every segment of the business delivering positive sales growth.

Woolworths Food delivered turnover and concession sales growth of 5.7%, with continued market share gains.

The food segment’s gross profit margin was stable at 24.9% despite elevated fuel and distribution costs.

“The performance was supported by the quality and innovation of the offering and a continued focus on an elevated in-store customer experience,” Ngumeni said.

Revenue through the Woolies on-demand service grew by 19.6%, with the online channel contributing 7.3% to SA Food sales.

While these numbers looked good, analysts pointed out that Woolworths Food performed poorly in the second half of the financial year with lower volumes.

Sales growth declined to 4.4% due to slower growth in the electronics and grocery categories.

Ngumeni admitted that volumes are what make the Woolworths Food business work, which means the issue in the second half of the year has to be addressed.

“The problems were in our bakeries and produce. In produce, we have a closed group of suppliers that we buy from,” he said.

“Over the last six months, South Africa did not have the best weather and we struggled with volumes from our suppliers.”

However, it was not the volume of products which were supplied which was the problem. Instead, it was the quality of the products.

“We were uncomfortable with the quality of the products and, therefore, could not put these products on our shelves,” he said.

“I will make that call again. We cannot put a product on our shelves which is not of the quality which our customers expect.”

He said that they have worked with their suppliers to ensure a more predictable quality and secure outcome in the future.

Woolworths has also partnered with additional suppliers to ensure it does not face such shortages in the future.

“We know what the problem was, we know what the solution is, and we are executing on this plan,” he said.

When it came to the Woolworths Food bakeries, Ngumeni said they are focusing on innovation to improve quality and provide better value for money.

Beyond product quality, Woolworths is also looking to expand its food-service offering through partners like Uber Eats.

“We are also working with Engen to double our food court presence at petrol stations across South Africa,” he said.

Woolworths Food is also improving its online platform to drive sales in the on-demand grocery segment. “There is a big opportunity there,” Ngumeni said.

“These are the right things to do, and we are confident that we will recover from the volume decline in the second part of the year.”