Woolworths Food: High-end Retail in Tough Economic Times
Dr Thabo Mosala & Claire Beswick
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Wits Business School, University of the Witwatersrand
In February 2009, Julian Novak, Woolworths divisional director of food, announced a new strategy for the company’s food division. The South African retail sector had been affected by the global economic downturn and conditions were grim. By August 2008, Woolworths Food had already shown a drop in market share. (See Exhibit 1.) Novak’s new strategy included drastic reductions in prices and a variety of special deals and discounts. It was essential to attract lost customers back into its shops. Would Woolworths be able to do this while maintaining its quality/value proposition and its commitment to providing safe, healthy and environmentally friendly products?