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“Importantly, this commitment also applies to Shoprite Checkers’ franchise business, OK Foods. Specifically, when Shoprite Checkers has the lease on behalf of a franchisee, the commitment will be implemented immediately, “the commission said.
“When franchisees have the lease, Shoprite Checkers and the commission have agreed that, within a 12-month period, Shoprite Checkers will work with its franchisees to ensure compliance with the commitment. Shoprite Checkers will also ensure that its future franchise agreements do not allow franchisees to have exclusive lease agreements. “
The commission welcomed the retail giant’s move and said it would now see “much-needed competition in South Africa’s grocery retail sector.”
“This Shoprite Checkers move is timely considering the devastating impact of the coronavirus pandemic on the South African economy overall, and specifically on the retail and retail property sectors,” said Commissioner Tembinkosi Bonakele.
“Even more encouraging is the leveling the playing field between small, independently owned grocery retailers and small franchise operators that take advantage of the bargaining power that comes with partnering with well-established brands from national supermarket chains.” .
The commission has forwarded the agreement to the Competition Court.
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