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Moving forward

In 1998 Pick n Pay continued the momentum of change embarked upon in 1995 with the appointment of Sean Summers as Managing Director for the Group while Gareth Ackerman became Deputy Chairman overseeing international ventures.

The Retail and Group Enterprises divisions were maintained as separate entities, and further changes occurred in April 1999 when Company Chairman Raymond Ackerman announced the appointment of Sean Summers as Chief Executive Officer.

Gareth Ackerman took up the position of non-executive Deputy Chairman vacated by Rene de Wet, who had retired, with the task of looking after the family's interest in the group; while Raymond Ackerman remained as 'hands-on' Chairman. Explaining the decision, Raymond Ackerman said that Pick n Pay was first and foremost a family business – a major contributing factor, not only to the success of the Company, but also to the respect it enjoyed from the South African public.

However, he conceded that Pick n Pay’s corporate governance rules had to take into account the demands that being a family business placed on the group – not least of which was the question of succession-planning.

The appointment of Summers as CEO had therefore been made in order to enhance the Company's commitment to corporate governance – unique in the context of a family owned business – while assuring the long-term growth of the Company. Essentially the move changed Pick n Pay from a family owned and managed business to one managed by professionals – while still owned by the Ackerman family.

Emphasising the widespread benefit of the appointment, Ackerman said, “Family ownership underpinned by professional management has empowered the Company to plan and act in the long-term interests of all Pick n Pay shareholders”. Defining the interlinked roles of family ownership, the Board of Directors and Executive Management in a family controlled business, Ackerman explained that while the family remained in control, the Board acted in a supervisory capacity to stabilise the running of the Company, while management was in what he described as “the best possible hands”.

Changes were also afoot in the Hypermarket Division, with their consolidation into a single operating unit under the leadership of a director. In 1998, rapid growth, coupled with the realisation that certain processes were being duplicated across the 14 outlets, led to a restructuring of the Hypermarket Division, and a move away from its original decentralised nature.

The result was a consolidation of the division into a single operating unit with a support office located in Gauteng. The lead was taken from France’s Carrefour hypermarket chain – the model Ackerman used when he built the first Pick n Pay Hypermarket in 1975.

Although Carrefour had initially operated in a decentralised fashion, it had recently consolidated its buying and logistical operations, setting the scene for Pick n Pay to follow suit.

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