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Kasper Rorsted, chief executive officer of Adidas AG, gestures while speaking during a Bloomberg Television interview in London, U.K., on Tuesday, Oct. 1, 2019.
Kasper Rorsted, chief executive officer of Adidas AG, gestures while speaking during a Bloomberg Television interview in London, U.K., on Tuesday, Oct. 1, 2019.
Simon Dawson | Bloomberg | Getty Images

Social media has made it easier for consumers to hold companies and CEOs accountable for their actions, and that’s a good thing, Adidas CEO Kasper Rorsted told CNBC’s Sara Eisen at the CNBC Evolve Global Summit.

“I think that the scrutiny on companies and CEOs are much greater today. I think that part of the reason is social media is bringing a transparency and also a news flow out that was never there before,” Rorsted said. “It drives change, it drives responsibility, and it drives transparency.”


The scrutiny will force the fashion industry, which produces 8% to 10% of global carbon emissions, to become environmentally friendly, Rorsted said.

“This is only the beginning, but the impact plastic has on our global environment is so negative. And as a company that stands for something positive … we really want to make sure that that problem is tackled,” Rorsted said. “It’s so fundamental for companies to really help innovate and find solutions that address the environment, not to be disrupted for the future.”

Adidas has made strides to create sustainable products, including using ocean plastics in its shoes and vowing to make nine out of every 10 products sustainable by 2025.

“I don’t mean this disrespectfully, but European companies — maybe due to regulation — have tended to be ahead,” Rorsted said. “We see ourselves as a leader in sustainability, but we actually welcome everybody who has taken a step forward.”

The company partnered with Allbirds to create shoes with a low carbon footprint, largely due to the rival shoemaker’s success with creating sustainable products at a low cost, which has been a challenge for Adidas. Allbirds uses materials such as merino wool, recycled bottles and cardboard and castor bean oil to manufacture its shoes.

“They’ve done, been doing a great job on certain elements of innovation. We can bring the footwear expertise into it, which they probably had to a lesser extent,” Rorsted said. “Succeeding in sustainability is more important than, you know, competing with each other.”

Later this summer, Adidas will be releasing its classic Stan Smith shoe using a leather derived from mycelium, the fibrous root structure of mushrooms. The company anticipates it will be very popular.

“We have done a recent survey; 70% of our consumers prefer to buy sustainable products. So I think there’s going to be a great demand for this product,” Rorsted said.

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(Photo by Edward Berthelot/Getty Images)
(Photo by Edward Berthelot/Getty Images)
The news of Zara-owner Inditex’s plans to close more than 1000 stores around the world, caused much panic on the internet in 2020. Not to mention, the thought of threatened livelihoods of Zara employees.

However, there was more to the story than meets the headline, as the scheduled store closures around the world are said to be in favour of a transition to e-commerce. Reassuringly for us, The Guardian also reported that “closures are expected to be concentrated in Asia and Europe.” 

Reuters reported that Inditex, booked its first quarterly loss as the coronavirus crisis forced it to shut most shops, but its shares rose after it unveiled a 2.7 billion euro plan to accelerate its focus on large stores and online sales. This is after the Spanish company was forced to shut almost 90 percent of its stores from February to April 2020.

Inditex aims to focus on its online business and large stores in prime shopping areas while closing around 1000 of its smaller stores. It expects virtual sales to account for more than a quarter (25 percent) of business by 2022, compared to their current 14 percent. Larger stores will therefore act as distribution hubs for online sales.  

This is why Zara is currently refurbishing and enlarging its flagship store at the V&A Waterfront in Cape Town in order to make it the brand’s newest concept store in South Africa, offering a fully integrated experience with   

There are currently eight Zara stores in South Africa, a Zara Home store at the Mall of Africa, in addition to the Spanish retailer being available online to local shoppers since 2019 – eight years after establishing a presence in the country.

So in line with Zara’s commitment to South Africa, the brand is investing in this high quality, digitalised and differentiated store – by expanding the store to approximately 2700 square meters – to feature the latest sustainability and technological developments of its integrated store and online sales platform. 

This extended store is being designed according to the brand’s new global concept, highlighting flowing curved lines that enable continuous engagement with the fashions on display. Zara boasts that it can be described in three words; “simple, sophisticated and refined.”

Sleek white surface running across the ceilings and walls are the interior notes that will create a backdrop that enhances each collection. The Zara team further reveals that their refurbished store will be a “warm and natural environment with pockets of greenery which represent the idiosyncrasy of the brand linked to the type of product and its sustainability standards, inviting customers to enjoy a holistic shopping experience.” 

Inditex books $513 million first-quarter profit

Spanish retail giant Inditex reported a first-quarter net profit of 421 million euros ($513 million) on Wednesday, a number that easily beat analysts’ expectations but was still a third below pre-pandemic levels.

Zara’s sustainability efforts see the Spanish retailer continue to execute their environmental transformation plan – having met their 2020 target to make all their stores eco-efficient. This new space is therefore connected to the company’s central energy efficiency control system, Inergy. 

In addition to this, part of the furnishings are made from biomass and new areas are will be allocated for cardboard and gently worn clothing to be recycled.

But that’s not all. 

The in-store Customer Experience areas will offer new convenience spaces such including a showroom and a fitting room waiting area. So maybe a little something like this? 

Zara shop in Preciados street in Madrid, Spain. (P
Zara shop in Preciados street in Madrid, Spain. (Photo by Cristina Arias/Cover/Getty Images) 

Add to that, a fully fitted Beauty section similar to the likes of its retail counterparts; Woolworths, Edgars, Foschini, and Truworths. This new Beauty section will offer shoppers a unique immersive experience complete with personalised beauty advice.

Shoppers can experience this Beauty section on the ground floor singled out by colour-matching flooring, walls and ceilings, in contrast with the stainless steel trays that highlight the new product lines developed in collaboration with Diane Kendal. 

Here, we detail 6 more retail innovations and re-entries we’ve seen over the 2020/2021 period:  

Hi there, StyleMode

The need to reconsider outdated business models made itself apparent in retail long before Covid-19, which is probably why StyleMode considered 2020 a time ripe as any to open up (virtual) shop in SA last October.  

Powered by – SA’s new fashion e-tailer, StyleMode – instead of dipping a toe in, is taking a dive into waters that are already warm, given the stats of our bubbling online retail industry.

They entered the market with a range of brands across apparel, footwear, accessories and a plus-size range – all at a price point that will suit most pockets in our country’s economy.

READ MORE: SA welcomes a new online fashion portal as brick-and-mortar retail ebbs and eCommerce flows     

An EGG-citing innovation 

Born with a vision to “reimagine retail,” a 2 700-square-metre space – EGG – opened at Cavendish Square in Claremont, Cape Town, housing 250 local and international brands across the categories of fashion, beauty, living, streetwear and sneakers, accessories and jewellery, and even food.   

The store promises shoppers a unique, “phygital” omni-channel experience.  

As reported by BizCommunity, the next three years will see three more EGG stores launch in South Africa – one at The Zone @ Rosebank and Bedford Centre in Johannesburg, and another at Gateway Mall in Durban. 

A first for South Africa

Chanel unveiled its new fragrance and beauty boutique at the V&A Waterfront in Cape Town in December 2020. 

Dedicated to fragrance, makeup and skincare, this boutique brings Chanel Beauty into a new dimension for South Africa, reinforcing the ties between the House and its clients.

The 61sqm space will feature the first standalone pop-up concept for South Africa, and was projected to expand to 106sqm in 2021. This year, Sandton City has since welcomed the second Chanel Beautique in the country.

READ MORE: Chanel unveils its first-ever perfume and beauty boutique in SA at the V&A Waterfront

GAP returns to South Africa

Launching in the country’s largest shopping center, Gap opened its doors on 26 November 2020 at the Mall of Africa with the brand’s Summer and Fall collections for men, women, kids, toddlers, and infants. 

“Since we exited the market in 2017, it has been a priority to evaluate future partnerships for Gap in South Africa and to restore confidence in our loyal Gap customer base. By partnering with Hyvec Group, we are opening an exciting chapter in our growth strategy and are incredibly energised about what the future holds,” said Roy Hunt, SVP of Inc. Franchise & Strategic Alliances.    

After the store opening in Mall of Africa, the Hyvec Group plans to carry out a sustained national growth plan with additional store openings in South Africa, as well as the Bagatelle Mall in Mauritius.  

Welcome back, MANGO 

While South Africa has been lamenting a potential retail apocalypse since the likes of Stuttafords, River Island, Nine West, Topshop, and the Platinum Group stores all shut their doors for good and left our malls, it would appear Spanish retailer, MANGO, had been doing some work to cement a return to SA.  

Fast forward some three years later, and MANGO is a standalone store on our shores once again. 

While it’s unclear as to why exactly the fashion retailer returned to Mzansi, with their revival, the brand is consolidating its presence in Africa, where MANGO is present with 52 retail outlets, four of which are megastores. 

Welcome, Desigual

Founded in Barcelona, Spain in 1984, Desigual – in a rather optimistic move – opened its doors in Sandton City for the very first time in SA, in September 2020.

Desigual’s first store in South Africa carries collections from the Woman, Accessories and Shoes categories. As has been the norm since the launch of the new brand image in 2019, Desigual is using this store to showcase its new corporate identity and shopping experience. 

As the Spanish fashion brand’s Channels Director Jordi Balsells explains; “The South African market has an intriguing potential for growth. The qualities of our collections, such as the vibrant colours, the diversity of the materials and the uniqueness of the designs, match a style that will resonate with local consumers and which, combined with the Desigual DNA, has the potential to build a very strong connection with customers. 

Desigual hopes to open a second store on our shores in the near future at the V&A Waterfront where the Zara flagship store and Chanel Beauty’s first-ever SA boutique are also located.


Additional information provided by Zara South Africa

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(Photo: Waldo Swiegers / Bloomberg via Getty Images)

Pick n Pay, which has nearly 2,000 stores in South Africa, is a big user of exclusive lease agreements. It is the latest retailer to agree with the Competition Commission and Competition Tribunal to end the use of exclusive lease agreements. This is good for the consumer.


For many decades, South Africa’s Big Four supermarket chains — Shoprite, Pick n Pay, Spar and Woolworths — prevented one another and smaller grocers from opening stores at a particular shopping mall to protect their turf, remain competitive and profitable. 


To do this, supermarket chains entered into exclusive lease agreements with shopping mall landlords, which paved the way for such chains to be the only seller of specific goods at malls, for as long as 30 years. 


Put differently, there couldn’t be more than two competing supermarket chains at some shopping malls. This was by design between supermarket chains and landlords, which disadvantaged consumers as they would have limited shopping choices. For landlords, the use of exclusive lease agreements was profitable as they would be guaranteed to keep supermarket chains as tenants for a long time. After all, supermarket chains take up large spaces at malls.


But the use of exclusive lease agreements by supermarket chains and shopping mall landlords is starting to end after the intervention of the Competition Commission. 


In 2019 the competition watchdog concluded an inquiry into competition dynamics in the grocery retail market and recommended that the use of exclusive lease agreements by the Big Four supermarket chains must cease with “immediate effect” and be phased out within five years. 

It found that the use of exclusive lease agreements is anti-competitive and in contravention of the Competition Act because they “hinder the emergence of challenger retail chains to the main four retailers and [have] also served to prevent economic participation by smaller independent retailers”. 

Smaller retailers that were mainly blocked from entering shopping malls and relegated to opening stores on the periphery of malls are Food Lovers Market, Fruit and Veg City, and Liquor City. 

Pick n Pay, a big user of exclusive lease agreements at shopping malls where its stores operate, recently agreed with the commission to end the use of such agreements. On Friday, 11 June, the Competition Tribunal, the body which has the final say on anti-competition matters in South Africa, confirmed the agreement between Pick n Pay and the commission. 

This means that supermarket chains that are small, independent and controlled by historically disadvantaged people can open stores at shopping malls where there is already a Pick n Pay store. 

According to the commission, Pick Pay, which had 1,933 stores (Pick n Pay and Boxer branded stores) across South Africa by February 2021, has agreed to phase out exclusive lease agreements with its landlords over six years, ending on 31 December 2026. Pick n Pay has also agreed to not sign new leases that include exclusive clauses for new stores that it plans to open. 


The agreement to end the use of exclusive agreements also applies to 761 Pick n Pay stores that are not owned by the retail giant, but are owned and operated by franchisees. 

“The commission has prioritised opening up markets by lowering barriers to entry and allowing SMMEs [small, medium and micro enterprises] and HDI [historically disadvantaged individuals] firms to have a fighting chance in the economy. This is the only sustainable way towards a growing and inclusive economy,” said Competition Commissioner Tembinkosi Bonakele on Monday.

Woolworths wasn’t found by the commission to be a big user of exclusive lease agreements. Meanwhile, other retailers have also scrambled to cancel exclusive lease agreements. 

Shoprite, which operates Shoprite-branded stores, Checkers and Usave, also agreed with the commission and tribunal in October 2020 to immediately stop enforcing exclusivity provisions in its lease agreements with landlords. This agreement applies to Shoprite-branded stores and others in its portfolio, including Checkers, OK Foods and Usave. DM/BM

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