What Went Wrong When South Africa’s Shoprite Tried to Push North

Two decades ago, Shoprite unveiled an ambitious plan to expand beyond its home base in South Africa, and the company went on to enter more than a dozen countries north of the border. It became the largest grocery store in the world by tapping into markets with rapidly growing populations. The investors were confident that developing economies would spur demand for bread, Champagne, and a lot of other things. Shoprite's ability to sell basic groceries, pharmaceuticals, and luxury goods made it a good vehicle for their optimism.

Shoprite has largely retreated back to South Africa and a few nearby places after closing its operations in eight countries. In September it said it had wrapped up operations in Uganda and had left Nigeria. Finding good real estate, high relocation costs for managers, and subpar infrastructure were some of the problems the operations faced. Foreign exchange shortages and currency instability made it hard to return earnings. The more Shoprite moved away from South Africa's borders, the more difficult it became. The market has its own quirks.