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Daily Maverick
23-04-2025
- Business
- Daily Maverick
Pick n Pay pushes for a financial comeback by backing the Boks and partnering with FNB
In a few months, Pick n Pay's logo will sit on the back of the Springbok jersey – a bold move from the retailer that reported mounting financial losses in 2024. On Thursday, 27 March, SA Rugby announced that Pick n Pay would become a Tier 1 sponsor of the Springboks, placing its logo squarely on the back of the country's most iconic jersey. Just a year before, the retailer had reported a full-year trading loss of R1.5-billion. Its most recent interim results showed a 9.1% increase in trading losses year-on-year. To stem the bleeding, the group proposed a R4-billion recapitalisation plan, complete with a rights offer and plans to list its stronger-performing Boxer brand on the JSE to keep the ship afloat. It has been reported by News24, and Planet Rugby that the estimated cost of the Springbok sponsorship is worth R70-billion. Neither Pick n Pay or SA Rugby has confirmed this figure. Allies in the aisle Pick n Pay's Springbok debut follows hot on the heels of a newly inked partnership with First National Bank (FNB), which includes Smart Shopper-linked eBuck benefits and discounted groceries for qualifying cardholders. 'Amid rising household pressures, this strategic partnership helps us deliver even more value to South Africans while attracting new customers,' Pick n Pay said. FNB was also announced as the new front-of-jersey sponsor for the Springboks, replacing MTN after an eight-year stint. That sponsorship has been reported to be about R150-million by EWN and News24, although FNB declined to confirm the amount. Together the two companies, already deeply intertwined through their retail partnership, are now investing a reported estimate of R220-million into South African rugby. Separate deals, same team sheet Despite the overlap, FNB said the Bok sponsorship was independently negotiated. Pick n Pay also confirmed that the overlap was 'unplanned'. 'The strategic partnership between FNB and Pick n Pay was a standalone business decision and was not influenced by either party's involvement with SA Rugby,' Faye Mfikwe, chief marketing officer of FNB, said. Pieter Woodhatch, CEO of FNB's eBucks, echoed this, saying the bank had confidence in Pick n Pay's recovery strategy. 'Our partners are chosen strategically to drive mutually beneficial behaviours,' he said. 'We are proud to partner with an iconic brand like Pick n Pay.' The numbers suggest early success. Burger Friday specials (R50 for four burger patties, a lettuce mix, two tomatoes, four buns and cheese slices) and 99c bread loaves have attracted foot traffic. FNB told Daily Maverick that they've seen a 'positive uptake' in Pick n Pay's environment since the launch of the rewards programme. Exit stage left for MTN MTN attributed its departure from the Springbok sponsorship to a 'refreshed brand positioning' and a shift in strategy. 'This evolution is not a reflection of financial or economic pressures, but rather a considered, forward-looking approach,' the company said. MTN declined to confirm the total cost of its previous Springbok sponsorship, which spanned a number of World Cup wins and brand visibility at an all-time high. The bleeding balance sheet Pick n Pay's 2024 audited results painted a grim financial picture. The company reported a R3.2-billion after-tax loss, R6.1-billion in net debt and a R2.8-billion impairment on store assets. The retailer started pursuing a two-phase capital raise of up to R12-billion. This strategy hinges on shareholder support, Boxer's performance and stabilising operations in a constrained economy. While the company says its recapitalisation has 'significantly strengthened' its balance sheet, the outlook remains cautious. How does this affect you? For consumers, the Pick n Pay-FNB alliance appears to be paying off. Essentials like bread and burger kits are cheaper, while cashback benefits soften the blow of rising prices. But for Pick n Pay shareholders and employees, the financial risks are harder to overlook. The company is still in recovery mode and the Springboks sponsorship, though high profile, adds pressure to prove value. 'Sentiment is being impacted by the current trading environment,' said Shireen Darmalingam, an economist at Standard Bank. 'While inflation remains largely contained and is expected to hover around the midpoint of the target range, uncertainty has risen. Tariffs, especially those imposed by the Trump administration, have pushed up break-even inflation and weakened brand confidence.' Darmalingam added that retail sales volumes for February 2025 undershot expectations, growing by just 3.9% year-on-year, down from 7% in January, while food and beverage sales declined. This adds complexity to Pick n Pay's equation. While sponsorship may increase brand visibility, the retailer still faces the hard task of executing a turnaround amid economic challenges. DM
Forbes
03-04-2025
- Business
- Forbes
FNB Takes Front Of Jersey As Principal Sponsor Of The Springboks, Strengthening Its Commitment To SA Rugby
FNB Proudly Takes Front Of Jersey As Leading Sponsor Of Springboks A strong foundation is essential for building anything that will not only endure but also thrive. This principle is particularly evident in the world of sports, as demonstrated by South Africa's rugby ecosystem. Over the years, First National Bank (FNB) has played a crucial role in supporting the growth of rugby in the country. In a significant development, FNB has recently been announced as the principal partner of the Springbok teams. As part of this new partnership, FNB's logo will prominently appear on the front of the teams' jerseys, further solidifying the bank's integral role in South African rugby. More than just a sponsor, FNB has been a cornerstone of the sport's development, investing in structures that ensure long-term success. In an exclusive article on following this announcement, Faye Mfikwe, the Chief Marketing Officer of FNB, discussed the bank's commitment to South African rugby, its support for the women's rugby team, the sustainability of its investment, and its holistic approach to sponsorship. FNB's partnership with the Springboks signifies a deep commitment not only to professional rugby but also to grassroots development. The bank's investment covers all levels of the sport, including the men's Springbok XV and sevens teams, the Bok Women's team, and SARU's youth programs. By strengthening the foundation of South African rugby, FNB is ensuring that the sport continues to grow, compete, and succeed on the global stage. FNB's investment in rugby began long before its sponsorship of the Springboks. Through its grassroots initiatives, including the Classic Clashes and Varsity Cup, FNB has been a champion of youth development in South Africa. These programs, running for over two decades, have opened doors for young, talented players—many of whom come from historically underrepresented communities. Faye Mfikwe, Chief Marketing Officer of FNB This deep commitment to grassroots development was one of the driving factors behind FNB's decision to sponsor the Springboks. Mfikwe explained: "When we took on this property, what was certainly understood is that there was no local brand that was prepared to sponsor the Springboks because of just where they found themselves." FNB, however, had already laid the groundwork by supporting youth sports, making the sponsorship feel like a natural extension of their values. Mfikwe continued, "We've been doing school sports through our Classic Clashes program since about 23 years, and the Varsity sports for about 17 years." This focus on developing young talent from all corners of the country aligns with FNB's core mission: to empower South Africa's future leaders. "So when the opportunity to sponsor the Springboks came by, it just felt like the right thing to do," Mfikwe said. Since becoming the official sponsor of the Springboks, FNB has not just provided financial support—it has helped foster a culture of integrity, trust, and collaboration within the team. This cultural shift has been a key factor in the team's continued success on the world stage, culminating in back-to-back Rugby World Cup victories. FNB's involvement has been about more than visibility; it's about being part of a shared journey of growth and achievement. Mfikwe noted, "What we've been able to appreciate as FNB is having seen where that team came from in terms of, call it the discord, to the work the administrative team has done with the actual sports personalities... to ensure they foster a culture of cohesion, collaboration, and partnership." It's this ethos of mutual respect and unity that has allowed the Springboks to reach new heights. In terms of their partnership with FNB, Mfikwe highlighted that the trust within the team is vital to their success: 'They need to appreciate that they trust each other to get them to the next level and that they have each other's backs. And that's what we talk about when we talk help.' PARIS, FRANCE - OCTOBER 28: Siya Kolisi of South Africa lifts The Webb Ellis Cup following the Rugby ... More World Cup Final match between New Zealand and South Africa at Stade de France on October 28, 2023 in Paris, France. (Photo by) FNB's vision extends beyond just helping the Springboks succeed. The bank is deeply invested in the long-term development of rugby in South Africa, particularly through initiatives aimed at empowering communities. Mfikwe explained, "FNB is all about help. It's about changing lives, seeing communities grow, and enabling talent to shine." The bank's support of grassroots rugby, through initiatives like Varsity Cup and Classic Clashes, has helped elevate countless players, many of whom have gone on to play for the national team. Through these efforts, FNB has given young athletes a platform to showcase their abilities. Mfikwe added, "In turn, we've got 60 of those players through Varsity Cup that have actually played for the Springboks team." This direct link between grassroots development and the Springboks shows how FNB's support helps build a sustainable pipeline of talent for South African rugby. CAPE TOWN, SOUTH AFRICA - SEPTEMBER 19: Libbie Janse van Rensburg of South Africa Women celebrates ... More scoring a try with team mates during the Women's International Test match between South Africa and Spain at DHL Stadium on September 19, 2024 in Cape Town, South Africa. (Photo by Grant Pitcher/Gallo Images) FNB's commitment to rugby extends beyond just the men's game. The bank proudly sponsors South Africa's women's rugby team, reinforcing its dedication to supporting women's sports. Faye Mfikwe stated, "We've been proud to support the women's team, and we're fully behind them as they head into the Rugby World Cup." FNB's backing of the women's team reflects its broader commitment to equality in sports and the empowerment of female athletes, ensuring they receive the resources and recognition they deserve. FNB's sponsorship efforts go beyond financial support and talent development; they also focus on creating lasting engagement with rugby fans across the nation. The bank's approach is holistic, involving not only the players but also the communities they represent. Mfikwe emphasised, 'What is very clear about our sponsorship is that it's beyond the player on the field. It's about ensuring that the brand is felt and experienced by the communities where rugby is growing.' FNB has made significant strides in fostering a sense of connection with fans through various digital platforms and activations, ensuring that the sport's reach extends far beyond the rugby pitch. This connection also fuels the bank's sustainability and long-term success as a sponsor, demonstrating that it is not just about the matches but about being part of the broader rugby ecosystem. TOPSHOT - South Africa's flanker and captain Siya Kolisi reacts as he holds the throphy from the bus ... More carrying the rest of the team during the Springboks Champions trophy tour in East London, South Africa, on November 5, 2023, after South Africa won the France 2023 Rugby World Cup final match against New Zealand. (Photo by WIKUS DE WET / AFP) (Photo by WIKUS DE WET/AFP via Getty Images) Rugby has played a crucial role in bridging divides in post-apartheid South Africa. The Springboks' victories, particularly in 1995, 2007, and 2019, have served as symbols of national pride and unity. The 1995 Rugby World Cup, in particular, became a powerful tool for reconciliation. Nelson Mandela's support of the team, especially the iconic moment when he donned a Springbok jersey, helped transcend racial and political divides, turning the team's success into a symbol of hope for a nation healing from apartheid. The 2019 Rugby World Cup victory under Siya Kolisi's leadership further reinforced the theme of unity. Kolisi's journey from a humble background to leading his country to victory resonated deeply with South Africans from all walks of life. His leadership inspired a new generation of rugby players, especially in underrepresented areas, leading to a notable increase in youth participation in the sport. Statistics show that youth participation in rugby has increased by as much as 12% in these communities, highlighting the tangible impact of the Springboks' success on aspiring athletes. FNB's dedication to rugby is not just about short-term success; it's about long-term sustainability. Through continuous investments in initiatives like Classic Clashes and Varsity Cup, FNB is building a lasting legacy in South African rugby. Mfikwe remarked, "The sustainability, I think we've demonstrated that in the many years of investment... Classic Clashes has been running for 23 years, and Varsity Cup for 17 years and we have been there since the inception of both." This ongoing commitment reflects FNB's vision of creating a sustainable pipeline of rugby talent that will continue to benefit South Africa for years to come. DURBAN, SOUTH AFRICA - JULY 12: RG Snyman of South Africa during the South African national men's ... More rugby team captain's run at Hollywoodbets Kings Park on July 12, 2024 in Durban, South Africa. (Photo by Steve Haag Sports/Gallo Images) FNB's partnership with South African rugby, from grassroots initiatives to support for national teams, has played a key role in transforming the sport in the country. As the bank continues to invest in both the men's and women's teams, it is laying the groundwork for a brighter future for rugby in South Africa. Through programs that support youth development, strengthen communities, and celebrate diversity, FNB is fostering an environment where all players can thrive, regardless of their backgrounds. Mfikwe emphasised that this investment is part of FNB's broader mission to "create the change we wish to see, not only for rugby but for all South African sports." By doing so, FNB is ensuring that the legacies of both the Springboks and women's rugby will continue to inspire and empower future generations. FNB's partnership with South African rugby represents more than a sponsorship; it is a commitment to growth, unity, and long-term success. By investing in both grassroots development and national teams, FNB is helping to build a sustainable future for the sport while reinforcing rugby's role in fostering national pride. As the Springboks continue to achieve new milestones on the global stage, FNB's support guarantees that future generations of players—both men and women—will have the opportunities and resources to thrive.
