• Woolworths says its Woolies Dash delivery brand has led to a boost in online sales.
• It grew in sales by nearly 50 percent in the last half year.
• The company is still struggling to sell more of its apparel, especially as the popularity of cheaper online retailers like Shein and Temu grows.

In half a year Woolworths has seen the sales of grocery delivery service Woolies Dash grow by nearly 50 percent, and while nowhere near as ubiquitous as Checkers Sixty60, again demonstrates the South African appetite for convenience.

Especially in an environment where the retailer says “discretionary spend remains constrained.”

The comments came in Woolworth’s latest results statement for the half year ended 29th December 2024, where the retailer revealed that its South African online sales were boosted by the performance of Woolies Dash, which received a revamped application during the period.

The overall sales growth it achieved was reportedly driven by “positive underlying volume growth from improved availability, ongoing innovation, and our enhanced value proposition, reinforcing the trust that customers continue to place in our Woolies brand.”

It said food sales increased by 11.4 percent, being the leading business for the group, while in general its online sales increased by 37.2 percent in the period, driven mostly by Woolies Dash.

While online and food sales grew, Woolies is struggling to get the same kind of results from its apparel segment and it is weighing the company down.

“Whilst our Food business continues to perform strongly, the weaker than expected performances of our apparel businesses in both [South Africa and Australia] resulted in negative operational leverage for the Group,” it said.

In July last year, Woolworths blamed ecommerce upstarts like Shein and Temu for a sustained decline in its clothing sales across the globe.

“Whilst our Fashion, Beauty, and Home business continues to make steady progress on a number of its strategic priorities, trade was impacted by the weak macro environment, poor availability, and increased competition from the disruptive entry of international online retailers,” it said at the time.

South Africans quickly gravitated for cheaper and more convenient clothing options, disrupting the local apparel market. Thousands of locals signed a petition in June demanding that reported increased taxes on Shein and Temu be waved.

Alongside weaker customer spending power driving popularity of online retailers, a higher cost of living worldwide continues to impact the brand.

“Whilst we have no control over the macro factors impacting our business, we have remained resolutely focused on the execution of our strategies and continued investment behind our future growth initiatives,” it explained in its previous results.

Headline earnings per share decreased from 203.3 cents to between 148 to 158 cents per share in the period, denoting an overall struggle to find bigger profits for the company.