The miscommunication by Shoprite

The miscommunication by Shoprite

Monday, August 3, 2020 11:50 pm


By Chido Nwakanma

Two stories out of Shoprite in the last 12 hours of 3 August 2020 point to the dangers of weak and ineffective communication. Some fellows have tried to blame the media for a mistake that rests squarely on the heads of the management of Retail Stores Nigeria Limited and the Shoprite Holdings SE. They should get their messaging right.
Shoprite issued a statement earlier in the day of their OPERATIONAL AND VOLUNTARY TRADING UPDATE (52 WEEKS ENDED 28 JUNE 2020). They were complying with reporting requirements of the South African regulatory authorities.
The statement declared about their Nigerian operations that in their next filing they would classify Nigeria as “discontinued operations”. The statement in full:

“Nigeria – discontinued operations
Following approaches from various potential investors, and in line with our re-evaluation of the Group’s operating model in Nigeria, the Board has decided to initiate a formal process to consider the potential sale of all, or a majority stake, in Retail Supermarkets Nigeria Limited, a subsidiary of Shoprite International Limited. As such, Retail Supermarkets Nigeria Limited may be classified as a discontinued operation when Shoprite reports its results for the year. Any further updates will be provided to the market at the appropriate time.”

The plain and ordinary meaning of “discontinued operations” is an exit from the space. I no do again, in pidgin. There can be no other meaning.
The statement indicated their intention to divest from their assets in Nigeria in full or partially. Divestment from a business, according to the Oxford Dictionary, is “the action or process of selling off subsidiary business interests or investments.” provides further details. “Divestment is the process of selling subsidiary assets, investments, or divisions of a company to maximise the value of the parent company. … Companies can also look to a divestment strategy to satisfy other financial, social, or political goals.”

Once the news hit the ether, Shoprite now issues a rebuttal claiming that it is not leaving Nigeria. Good to know, but their statement should have made that clear initially.
One newspaper’s report tried to deflect by blaming other stories that attempted to contextualise the Shoprite statement in the wake of the announced departure of another South African retailer.
According to the Vanguard, “The Country Director for Chastex Consult, Ini Archibong, in a telephone conversation with Vanguard, said: “Shoprite is not leaving Nigeria. We have only just opened to Nigerian investors which we have also been talking to just before now. We are not leaving. Who leaves over a $30billion investment and close shop? It doesn’t sound right.
“We only gave this opportunity to Nigerian investors to come in and also help drive our expansion plan in Nigeria. So we are not leaving. “I have tried to say this to many people as I can. There should be no panic at all and all of that. There is no truth in that report.”

Shoprite by itself mismanaged communication of significant development in their enterprise. The saving grace is that they acted correctly soon after. The rule of thumb in the Information Age is that everyone involved must note that they have only a five-hour window to correct the wrong information. Otherwise, it becomes established, and they would need to work harder to fix it.


-Chido Nwakanma is president of the Nigerian chapter of the International Association of Business Communicators and Adjunct Faculty at the School of Media and Communication, Pan Atlantic University.


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