READER LETTER | Pick n Pay woes not a first in SA’s retail history

Pick n Pay will not be the first retailer to be destroyed by excessive debt. A few decades ago Metcash and its supermarket arm, The Friendly Grocer, declared insolvency after being unable to settle their debts.

Few realise how margins are squeezed, making it almost impossible to generate meaningful profitability and strong cash flows. An average sized supermarket costs R35m to set up in addition to millions of rand worth of stock in trade required to commence trading.

Then comes the huge overheads, rent, a minimum of fifty staff, diesel, gas and electricity are among a myriad of other costs.

Those who say the retail game is easy, need a reality check...it’s tough. The hours are gruelling and the sector has become highly competitive. These days there is a supermarket on every corner.

Sadly PnP will slowly fade into the sunset as new brands emerge.

Hamba kahle Pnp!

Peter Bachtis, Benoni