The Ohlthaver and List (O&L) Group does not intend on closing any retail outlets, and operations will continue as usual despite the group terminating a 27-year franchise agreement with massive South African retailer, Pick n Pay. This is according to the O&L Group’s executive chairman, Sven Thieme.

“We remain committed to maintaining our presence in the locations currently housing Pick n Pay outlets. Our operations will continue as usual, and there are no plans to close any stores. We value the strong relationships we have with our landlords, and will work closely with them to ensure stability and continuity throughout this transition period and beyon. d,” he told New Era. 

O&L currently operates 19 Pick n Pay branded retail stores in Namibia under a franchise agreement with Pick n Pay South Africa. 

On Monday, the O&L Group announced the termination of the Pick n Pay South Africa franchise agreement that will officially come to an end by 30 June 2025.

Responding to New Era queries, Thieme emphatically stated that the well-being of O&L’s employees is the top priority. 

He said during the 12-month transition period from 1 July 2024 to 30 June 2025, it will be business as usual. 

As such, Pick n Pay Namibia’s current responsibilities, employment conditions and workstreams will continue. 

“We are committed to ensuring job security and supporting our staff through this transition. Regular updates and support will be provided to all employees to ensure a smooth and orderly process,” he stated. 

While O&L has not yet divulged any concrete plans for the establishment of a fully-fledged local retailer, speculation is rife in the domestic retail industry that this is exactly what O&L plans to do. 

As of the end of June 2024, Pick n Pay Namibia employed about 1 700 individuals. 

O&L’s announcement of the franchise termination came as the South African-based Pick n Pay Group reported a 373% decrease in net profit, down from a R1.17 billion profit to a R3.2 billion net loss for the year that ended 25 February 2024. 

A turnaround strategy for the group entails the retailer closing or converting more than 100 stores in South Africa. 

Pick n Pay South Africa was established in 1967, and remains one of the largest retail chains in the region, including stores in Namibia, Botswana, Zambia and Zimbabwe.

“Our priority has always been to serve our Namibian customers with excellence, and to contribute positively to our local economy. We have formally notified Pick n Pay South Africa of our decision, and we are committed to a 12-month transition period, effective 1 July 2024 until 30 June 2025, to ensure a smooth and orderly transition. During this time, we will focus on minimising any disruptions to our employees, customers and business partners. ‘Change is the only constant’, and we believe this change will bring growth and innovation,” he stated. 

An O&L statement issued on Monday noted the group is committed to retail, and is “exploring the best way forward to create consistent value-added retail experiences, ultimately benefitting all our stakeholders. While we appreciate the long-standing partnership we have had with Pick n Pay South Africa, we are confident that this decision aligns with our commitment to being a more customer-centric and Namibian market-oriented business, staying true to our essence of being authentic, caring and passionate. We look forward to embarking on this transformative journey”. 

Meanwhile, union leadership representing the majority of Pick n Pay Namibia employees told New Era this week that it does not anticipate any retrenchments or changes in working conditions emanating from the termination of its franchise agreement. 

Penda Jakob, secretary general of the Namibia Food and Allied Workers Union (Nafau), said official engagement will be guided by the letter of the law.  

In 2022, Pick n Pay Namibia boasted a staff complement of about 1 700 people, of which more than 74% were in the Nafau bargaining unit.

“We are guided by law. Therefore, we will be directed by the Labour Act. We are not expecting any negative impact on employees. We will engage in proper discussion as the representative union. We have received written notification from our social partner to ensure we won’t lose any employees or conditions of employment. We will engage Pick n Pay Namibia to do the right thing in terms of the law,” Jakob told New Era. 

Pick n Pay Namibia and Nafau signed a substantive agreement on 10 July 2023, which is valid until 30 June 2024.

 The agreement applies to all bargaining unit employees of the retail company.