Pick n Pay, BP join forces
PICK n Pay (PnP) and BP Southern Africa (BPSA) have formally combined forces, which will see the roll-out of small-format PnP stores located at BP service stations in major metropolitan areas across South Africa.
The companies said yesterday PnP Express stores would stock between 1500 and 2500 product lines and stay open 24/7, catering to the convenience retail market.
They initially signed a memorandum of understanding in July 2008, and have tested the model at two PnP Express stores in Hout Bay and Tokai in Western Cape at the end of the same year. There are currently nine PnP Express stores on BP forecourts.
"The initial plan is for 120 BP Express stores to be converted to PnP Express stores over the next five years, although additional stores may also be converted after the initial five-year period," PnP said.
Both companies said they were confident the dual format brought multiple benefits to the two companies, their franchisees, suppliers and customers, who were in search of efficient and affordable convenience retailing.
"We've tested the format over the past three years and the feedback from customers is very positive," PnP's deputy chief executive officer Richard van Rensburg said.
International experience suggests that small-format stores often spur growth, and most leading global retailers have a multichannel presence, including forecourt outlets.
The agreement brings into play key strengths of both businesses and enables PnP to expand its small-store format while continuing to create new entrepreneurs, in line with its franchise strategy.
Gerard Derbesy, BPSA's chief executive officer, said the offering was in line with BPSA's growth and investment plans over the next two years.
Chris Reed, franchise director at PnP, said express stores were small-format franchise stores, which, while on BP forecourts, were instantly recognisable as PnP stores.