Iconic retailer shrinking stores in South Africa

Edgars is resizing its store base as per its turnaround strategy as the retail icon recovers from nearly two decades of headwinds and financial challanges.

Edgars was founded in 1929 by brothers Morris and Eli Ross, with the first store opening on Joubert Street in Johannesburg.

Eli Ross is credited with introducing the ‘six-months-to-pay’ credit option during a spring sale, a pioneering move in South African retail.

The company was listed on the Johannesburg Stock Exchange (JSE) in 1946 and would see rapid expansion throughout the 1950s and 1960s, and would purchase the Sales House and Jet businesses.

Edgars was taken over by South African Breweries (SAB) in the early 1980s, with the company continuing to grow significantly.

In 2007, the US private equity firm Bain Capital acquired Edcon, Edgars’ parent company, in a leveraged buyout worth R25 billion.

The company would, however, fall into hard times, which included mounting debt and increased competition. These issues were only exacerbated by the 2008 global financial crisis.

Edcon ultimately entered business rescue and was bought by Retailability in September 2020. Since the buyout, a significant focus for Retailability has been reducing the group’s overall store footprint.

This has seen several stores decrease their occupied space, including the Sandton Edgars being scaled down from 12,000 sqm to 5,500 sqm.

The trend has continued and has been highlighted by South African REITs in recent trading updates.

In an operational update for the five months ending 31 May 2025, Hyprop noted that its retail vacancies stood at 3.9%, primarily due to Edgars’ rightsizing its stores.

At Cape Town’s largest mall, Canal Walk, Hyprop said Edgars downsized from 11,000 sqm to 5,400 sqm.

This has made space for a new Jet flagship store (now owned by The Foschini Group), a new Home Tech Sleep, and a soon-to-be-completed Incredible Connection flagship offering. 

Although the drop in size may be seen as a problem, Hyprop said that Edgars is performing well in the new downsized footprint, which includes a “world-class fragrance and cosmetics offering.”

Hyprop also noted that Edgars will soon be one of the stores moving to the new expanded area at Somerset Mall.

In a separate update for nine months to 31 March 2025, Growthpoint Properties said that its retail vacancies increased slightly from 5.5% in FY24 to 5.7% in FY25.

This was due to Game, which is also undergoing a massive store resize, exiting Brooklyn Mall and Alberton City, and space reductions by Edgars at Alberton City, Northgate Mall and Kolonnade Shopping Mall.

Growthpoint Properties added that it expects further Edgars reductions at Walmer Park Shopping Centre, Paarl Mall and Vaal Mall, while it will exit the Keywest Shopping Centre.

Growthpoint Properties also noted that the former Edgars premises at Beacon Bay Retail Park in the Eastern Cape have become a Builders Express. 

Edgars is not the only major retailer to be resizing its store network, with Pick n Pay undergoing a massive change in its retail network.

Pick n Pay is also undergoing a massive turnaround after it posted an over R3 billion loss in the 2024 financial year, which includes closing certain Pick n Pay stores and converting others into Boxers.

CEO Sean Summers has recently noted that South Africa has too much retail space, placing the financial viability of retailers at risk.

“South Africa is about to equal, or squeak past, the US on the square meter per capita of retail,” said Summers.

“If you’ve got retailers who are prepared to just open stores at any cost, then a shopping centre works. But I would question the medium-to-long-term wisdom of the strategy”, he said.

Many former Pick n Pay stores are now being taken over by its largest rival, Shoprite. This includes the opening of a Checkers at Hyprop’s Hyde Park Corner in August in a former Pick n Pay site.