Exploring the fourth wave of supermarket evolution: concepts of value and complexity in Africa

Abstract

The increase in urban development and an increasingly stable and economically empowered middle class in Africa are both driving the expansion of supermarket activity in these new, lucrative, African markets. Much of this activity comes from South Africa and has triggered what can be seen as the "fourth wave" of global supermarket evolution. This paper reviews the background, examines the expansion of three major South African supermarket businesses into the African continent, and assesses the impact on local producers of goods and services. It does so by introducing the concept of value chain to reveal some of the new complexities in this process and to show how some of the issues associated with value must be mitigated so that there can be a successful marriage between the traditional and new business practices in the host country economies. The discussion and analysis is based on a range of interviews with senior management in the three South African retailers.