Woolies Dash pumping

On-demand delivery service Woolies Dash recorded substantial growth in the second half of 2024.

According to Woolworths’ interim results for the 26 weeks ended 26 December 2024, the service posted a 49.2% increase in sales compared to the same period a year ago.

That performance helped boost the Woolworths Food division’s online sales, which increased by 37.2% and contributed 6.4% of total food sales.

While the Woolies Dash performance is impressive, it is not unusual considering the substantial uptake in on-demand services across retailers in South Africa.

Woolies Dash itself has regularly recorded significant annual growth. For example, in the full-year ended 30 June 2024, sales were up 54.4%.

To evolve the service and speed up deliveries, Woolworths launched its first dark store in Cape Town’s CBD in August 2024.

The “store” is not open to the public and is solely for fulfilling online orders, effectively making it a mini-warehouse or distribution hub.

The layout is optimised for online-first delivery, helping speed up the process. Woolies Dash staff in the dark “stores” also don’t have to compete with in-store shoppers.

In-store shoppers have often criticised the item pickers used by competing services for increasing traffic and, at times, seemingly rude behaviour as they move quickly to ensure orders are fulfilled on time.

The focus on boosting Woolies Dash comes as the gap in the contributions of Woolworths’ food and other businesses continues to expand.

In the latest interim period, the retailer said Woolworths Food was a standout performer and delivered market-leading turnover and concession sales growth of 11.4% and 7.3% on a comparable-store basis.

Woolworths Food revenue increased from R22.44 billion to R24.96 billion, making up around 62% of the group’s total revenue. It also recorded a profit before tax of R1.57 billion, around 77% of the group total.

“This was driven by positive underlying volume growth from improved availability, ongoing innovation, and our enhanced value proposition, reinforcing the trust that customers continue to place in our Woolies brand,” the company said.

Woolworths’ apparel businesses, which include the Fashion, Beauty, and Home (FBH) division and its Country Road stores, contributed less to the overall group’s performance.

Woolworths explained these businesses were in the “throes of significant transformation,” including a reduction in their physical footprints and an increased focus on online sales.

In the FBH division, Beauty performed best, with 17.3% sales growth. FBH online sales increased by 25.2% and contributed 6.6% of FBH sales.

FBH revenue increased marginally from R7.51 billion to R7.64 billion, but its overall contribution shrunk from 19.8% to 19.1%.

The Country Road business also saw an increased contribution from online sales, which accounted for 27.1% of the division’s sales for the period, up from 26.8% in the prior period.

However, revenue was down 8.8% — from R7.2 billion to R6.6 billion.

Overall, Woolworths Group increased turnover and concession sales by 5.7% to R40.3 billion, while adjusted earnings before interest and tax stood at R2.8 billion.

Profit for the period increased by 20.9% from R1.8 billion to R2.2 billion.

However, headline earnings per share decreased 24.8% year-on-year, while the declared interim dividend per share reduced 27.7%.

Return on capital employed also declined from 22.3% to 17.0%.