Group strategy
To create sustainable long-term shareholder value through a retail-led health, beauty and wellness offering.
Group strategic objectives
1
Increase customer appeal and access by expanding the store, pharmacy and online presence
2
Accelerate market share gains in pharmacy and core front shop categories
3
Promote UPD’s national pharmaceutical wholesale and distribution services to grow market share
4
Deliver operational excellence with an efficient centralised supply chain
5
Create an inclusive and transformed organisation with a strong talent pipeline to support business growth
6
Ensure sustainability through efficient cash and capital management and entrench robust environmental, social and governance practices
Strategic drivers of longer-term growth
These strategic drivers of longer-term organic growth should ensure continued competitive advantage in the health and beauty markets in which the group operates.
Favourable market dynamics
- Healthcare markets are defensive and offer long-term growth opportunities in South Africa.
- Improving living standards, increasing urbanisation and longer life expectancy is contributing to a growing market for health and beauty products.
- An increasing proportion of the population is entering the private healthcare market.
- The increasing use of generic medicines will continue to make healthcare more affordable.
Convenience
- Goal to expand the Clicks store base to over 1 200 in the long term, with a pharmacy operating in every store.
- Clicks Baby standalone stores enable the group to capitalise on the growth in this strategic category.
- Goal to achieve retail pharmacy market share of 30% in the long term.
- Customer convenience is supported by an online store and a national pharmacy delivery service.
Differentiation
- Private label and exclusive brands offer differentiated ranges at higher margins.
- Clicks is a brand that consumers trust and the brand has demonstrated its ability to transcend product categories and markets.
- Exclusive franchise brands The Body Shop, GNC and Sorbet augment Clicks’ private label brands in the health and beauty categories.
- Sorbet beauty salon chain further differentiates offering.
Personalisation
- Clicks ClubCard is one of the largest retail loyalty programmes in South Africa, with 10.4 million active members.
- ClubCard offers customers generous and convenient cashback rewards and an increasing range of affinity partner benefits.
- Migrating ClubCard members onto the Clicks app supports the personalisation strategy.
- Opportunity to influence customer behaviour and leverage personalised digital engagement via the ClubCard, website, online store and mobile app.
Growth opportunities for UPD
- UPD provides an efficient healthcare supply chain which supports the growth of the Clicks business.
- UPD offers national wholesale services to private hospitals and independent pharmacies, including Link pharmacies.
- The business offers a distribution service to local and international pharmaceutical manufacturers based on price, quality control and speed to market.
- Goal to achieve wholesale pharmaceutical market share of 35% and bulk distribution market share of 35%.