Shoprite’s move into a new category — coffee retail — marks the latest expansion in the group’s push to become the ultimate “everyday store”, steadily colonising every adjacent aisle of convenience.
It’s a savvy bet. Coffee is one of retail’s few recession-proof indulgences: a high-margin category that keeps brewing profits even when consumers are tightening their belts everywhere else. Its acquisition target, Vida e Caffè, already has a strong footprint at forecourts and convenience outlets through its 400 stores. And while the deal surprised the market, it fits Shoprite’s broader strategy.
Vida and Seattle Coffee Company, both about 25 years old, are the country’s biggest national chains. Bootlegger, Plato, Motherland and a wave of newer independents are all growing too. Xpresso Café is a fast-expanding chain with a clear price edge — everything on its menu costs R14. And then there are the heavy hitters in the listed retail sector: Woolworths with its WCafé and Famous Brands with Mugg & Bean. So, while South Africa’s coffee market is becoming more heated, it is far from saturated. In fact, the FM called the country’s coffee race earlier this year.
Shoprite CEO Pieter Engelbrecht has said the group is increasingly inclined to partner with or buy businesses that bring specialist experience, capacity or speed to market, rather than building from scratch. He expects Vida to become part of the Shoprite ecosystem by mid-2027.
The question is how much of Shoprite’s infrastructure and buying power will flow through to Vida’s existing franchisees and how quickly the network will grow once the deal closes. Vida also sells through Uber Eats and Mr D, which could dovetail with Shoprite’s own on-demand delivery push via Sixty60.
Rivals Pick n Pay, Woolworths and Spar are already active in forecourt and convenience retail, and forecourt convenience sales grew 4% to R40bn in 2024, underscoring why retailers are racing into the space.
Vida CEO Darren Levy told the FM earlier this year that there is still enormous headroom in the category, with strong demand for coffee in locations that don’t yet have speciality options. New residential nodes, expanding secondary cities, forecourts, offices, airports and universities have all become part of Vida’s footprint, alongside partnerships with retailers Builders and Exclusive Books and airline Lift.
Vida e Caffè, Portuguese for “life and coffee”, was founded in Cape Town in 2001 by Brad Armitage and Rui Esteves and now serves more than 2-million coffee shots a month. The business is owned by private equity firm Athena Capital and runs a hybrid model in which two-thirds of stores are franchised and the rest company-owned. It plans to open more than 40 new stores this financial year and expand to two additional countries.
Shoprite wasn’t the first major retailer to spot Vida’s potential. It was, in fact, Spar, whose existing in-store agreement with Vida expires in June. It’s unclear what will happen to the Vida outlets in Spar stores.
It’s also unclear what happens to Starbucks, which Shoprite has partnered with for years while testing various formats. Engelbrecht was noncommittal about a wholesale replacement, saying there’s no plan to push Starbucks out and that Shoprite would “cross that bridge” later. He noted that Starbucks hasn’t opened new stores in South Africa for several years.
Vida won’t be rolled into every Shoprite or Checkers store. Engelbrecht tells the FM that the approach would be selective — avoiding areas already well served by coffee shops and steering clear of regions such as the rural West Coast, where an existing partner is performing well. The goal is to create a “node”, he says, leveraging Vida’s brand equity rather than pursuing blanket coverage.
Engelbrecht sees coffee as a high-margin opportunity on several fronts. He puts the combined South African coffee and coffee shop retail market at R40bn–R45bn a year, with room for Shoprite to capture a meaningful share. Coffee also reinforces the “everyday store” positioning, and he describes coffee culture as something in its own right, even if only for customers who want to sit and use the Wi-Fi.
There’s an operational upside too. Vida can piggyback on Shoprite’s delivery infrastructure at minimal extra cost, while private-label ranges such as Simple Truth and Forest and Feast offer add-ons like muffins, nuts and health bars that could be integrated into Vida’s offering.
Casparus Treurnicht, portfolio manager at Gryphon Asset Management, says that close to where he lives, 80% of all Checkers stores have a Vida nearby, “and if there isn’t one there, it’s something very similar. Stronger branded coffee shops are fighting to be in their vicinity.”
He says it’s all about attracting foot traffic and properly serving customers with a wide array of offerings. “It becomes a cycle of the one fuelling the other.”
And beyond coffee, he says, the retailer is offering outdoor, pet, pharmacy and baby-adjacent businesses “to get this machine feeding another loop”.
Just how well-oiled the machine is is clear from Shoprite’s full-year numbers: group sales rose 7.2% to R270.8bn, trading profit grew 8.4% to R16.2bn and the group hit its targeted trading margin of over 6%.
