Boxer looks beyond price wars as FNB joins retail strategy
Discount retailer Boxer is pivoting away from pure price competition as it integrates financial services into its retail strategy. The company, which was spun off from struggling parent Pick n Pay and listed on the JSE nearly two years ago, says partnerships are becoming an increasingly important part of its growth strategy as retailers look beyond price cuts to attract and retain customers in a highly competitive grocery market.
The retailer’s partnership with First National Bank (FNB), which offers qualifying customers 99c bread vouchers, launched in July. The collaboration forms part of a broader strategy to strengthen its value proposition while bringing additional services into its stores. Boxer plans to introduce FNB kiosks in selected Boxer stores, allowing customers to access banking services closer to where they shop. The initial rollout will cover 10 stores, with the programme expected to expand to between 30 and 40 stores by February.
According to Boxer CEO Marek Masojada, retailers are increasingly looking for ways to differentiate themselves beyond price alone. He noted that the retail sector has changed significantly over the last three or four years. “Traditionally retailers and financial institutions have all stayed in their lanes, and over the last three or four years that’s really changed. The opportunity is how we take the best out of both industries and bring them together in an environment that makes customers’ lives simpler,” Masojada said.
Shopping habits shift amid higher costs
The partnership comes as consumers continue to face financial pressure even with lower prices for some food staples. Masojada explained that products such as maize, rice, and cooking oil are cheaper than a year ago, but higher transport costs have offset many of those savings for consumers. As a result, customers are changing how they shop.
Customers want to buy bigger baskets but make fewer visits to reduce the transport costs attached to shopping. He added that retailers remain locked in intense competition for shoppers, with consumers comparing promotions before deciding where to spend their money. “The customer has a choice. Our customers do homework before they come shopping. They take all the pamphlets and leaflets and literally decide where their rand is going to go further,” Masojada said.
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Retailers cannot rely only on lower prices because that would not necessarily create customer loyalty. You can always put your price down, but whether you can actually have a sustainable economic model becomes a race to the bottom. You have to look for other ways and other levers within your business to resonate with a customer.
The retailer said the partnership is intended to broaden its offering by combining grocery shopping with access to financial services. It also supports Boxer’s presence in communities where access to financial services is limited. The company currently operates more than 350 supermarkets and about 200 liquor stores and is preparing to open its 600th store later in August.
Masojada noted that many Boxer stores are located in communities where banking infrastructure is less accessible, creating an opportunity to bring financial services closer to customers. Boxer also sees opportunities in the informal economy, where many traders already buy stock from its stores. “We spend a lot of time engaged with the informal sector. A lot of the traders come and buy from our stores, and we see a massive opportunity to take financial services into those little informal traders and spaza shops and enable them in a digital environment,” he said.
It would measure the success of the partnership through customer uptake of the bread vouchers and, over time, by whether it attracts more shoppers into Boxer stores, the retailer said. It expects the collaboration to strengthen its broader value proposition as competition among grocery retailers continues to intensify. While the partnership began with discounted bread, both Boxer and FNB said they are exploring additional opportunities to expand their collaboration, although neither company provided details on future initiatives.
Partnerships like this help retailers handle a challenging environment where financial stress impacts spending habits. Masojada’s strategy of integrating services reflects a broader shift in the industry. This approach mirrors the legal battles seen in corporate restructuring, where parties must align strategies to survive.
