As the group’s value chain, Exact! targets LSM 5 – 8 and is perfectly positioned to capitalise on this growing group of South African shoppers.
We offer our customers a consistent range of smart-casualwear which is easy to dress up or down and to combine. Our merchandise is well co-ordinated and housed, making Exact! a simple shopping experience.
While not the cheapest in the marketplace, we ensure that we offer excellent value for money. Value is measured by achieving a constant price-quality equation in line with our customers’ expectations.
Based in shopping malls, high streets and rural areas, we offer our diverse group of customers a consistent Exact! experience wherever they choose to shop.
| 2007 | % change | % change | 2006 | ||||
| 52 versus | 52 versus | ||||||
| 53 weeks | 52 weeks | ||||||
| Turnover (R million) | 682,6 | 15,2 | 17,4 | 592,4 | |||
| Number of stores | 180 | 5,9 | 170 | ||||
| Floor area (gross m2) | 51 386 | 7,4 | 47 855 | ||||
| Number of employees | 1 080 | 7,5 | 1 005 |
| Store location | % of turnover | % of m2 |
| Shopping malls | 41 | 38 |
| High streets | 28 | 24 |
| Rural areas | 31 | 38 |
We started to experience a slightly tougher retail environment in the second half of the year. In response to this, stock was controlled very efficiently. This had the positive effect of mitigating high markdowns that could have been incurred. This resulted in profit growing in excess of the comparable turnover growth of 17,4%. Comparable same store sales growth was at 12,9%.
| 2003 | 2004 | 2005 | 2006 | 2007 | ||
| Markdown value (Rm) | 50,8 | 53,9 | 66,2 | 84,6 | 91,0 | |
| % to sales | 13,8 | 12,9 | 13,7 | 14,6 | 14,3 |
Menswear performance was acceptable coming off an extremely high base in the previous year, while the performance of ladieswear was slightly below expectation.
It is clear that Exact! is a destination shop for footwear customers. This is supported by the outstanding performance achieved by the footwear department. Footwear sales grew way beyond expectation at 26,3% due to an enhanced focus on this area.
Accessories that were incorporated into the mix in 2006, to add excitement to the ranges and complete the look, were rolled out to all stores. This department achieved pleasing sales growth of 50,5%.
Cellular products were also in high demand and this was evidenced by a sales growth of 51,7%, which represents 18,5% of divisional turnover.
We piloted our “megastore” concept, a new, larger, multi-level format in Church Street, Pretoria and West Street, Durban and with the additional floor space, were able to offer expanded ranges. The initial response from customers was outstanding and sales growth in the first six months in each store was 34% on average.
| Performance by store concept | New concept | Old concept |
| Number of stores | 97 | 83 |
| Sales growth (%) | 18,3 | 16,0 |
| Sales contribution (%) | 64,7 | 35,3 |
| Trading density/m2 (incl. VAT) | R17 353 | R13 554 |
| Total number of stores | 180 | |
The new-concept stores continue to be rolled out in a controlled fashion, balancing up-front capital expenditure with improved sales growth and trading densities.
Additional product offerings and better utilisation of space improved trading densities, which have increased to R15 232 per square metre overall this year.
From a marketing perspective, window displays remained our biggest media opportunity and effort was placed on enticing customers with interesting and differentiable window displays and neatly merchandised stores. We are exceptionally proud of our achievements in this area.
We continued to support local clothing manufacturing through a strong collaborative effort between our group’s in-house design and manufacturing arm (TFGA) and our buying teams.
Our people development continues to be enhanced by our Retail Academy which has an accredited course with Stellenbosch University’s Business School, for store managers who show potential.
Exact!’s main corporate social responsibility initiative remains Monkeybiz, a non-profit organisation that employs and empowers over 450 disadvantaged and/or HIV-positive women. We continue to subsidise their soup kitchen, as well as giving support through donations. In addition, Exact! supported Attie van Wyk school and City Mission Safeline.
The foundation of our strategy and the six pillars of our business namely, people, fashion, value, stores, service and profit are firmly embedded into the fabric and culture of Exact!. In the year ahead, action plans and success criteria developed under each of these strategic pillars will drive the business forward. All projects will be managed holistically and clearly-communicated common goals will ensure that all departments work synergistically.
Emphasis will once again be placed on driving turnover growth while maintaining a balanced approach to stock control. Speed to market has become a strategic initiative and emphasis will be placed on improving our supply chain in order to optimise lead times. We will continue to develop and support the local supply base with the aim to procure at least 70% of our clothing purchases locally.
Based on the success of our “megastore” pilot in Durban and Pretoria, we will roll out this concept to further stores, thereby maximising opportunities in prime high-street sites. We plan to open five new stores in the new year, as well as relocating or enlarging four stores and revamping five stores. These initiatives will be strictly targeted at sites that enhance the brand and attract mass shopping.
| Store statistics | 2003 | 2004 | 2005 | 2006 | 2007 | |
| Number of stores | 170 | 169 | 170 | 170 | 180 | |
| Closures | 32 | 6 | 4 | – | 1 | |
| Floor area (m2) | 47 328 | 46 921 | 46 862 | 47 855 | 51 386 |
| Projection | ||
| Store statistics | 2008 | 2009 |
| Number of stores | 185 | 190 |
| Closures | 1 | 2 |
| Floor area (m2) | 54 408 | 55 220 |
The succession plans that we implemented last year are already showing signs of success and will be key in developing strength, stability and capacity in the division in the future. We will continue our focus on people development with particular emphasis on store management through structured training programmes.
We will continue to support our current corporate responsibility initiatives and will also launch some very innovative projects in the year ahead.
Abigail Bisogno, who has headed our Exact! division for many years, will be moving to the Foschini division as the managing director, to fill the gap which will be left by Simon Bowley. Her position in Exact! will be ably filled by Suzanne Annenberg, previously the marketing and planning director of Exact!.
South African consumer confidence, in spite of the recent interest rate increase, remains high. Our investment in our new stores and the refurbishment and enlargement of existing stores will enable us to capitalise on this growth. This will be further strengthened by a back-to-basics approach in order to achieve our strategic objectives.
