SECTION A. CASE STUDY (40 MARKS) QUESTION ONE Read the following case study and answer the questions that follow: Massmart wants to expand Game stores A customer browses electronic goods at a Game outiet in Johannesburg. File picture Nadine Hutton Johannesburg - Retarler Massmart intended to increase the number of Game stores offering fresh produce, food and liquor in the next few years, chief executive Guy Hayward said yesterday, Food and liquor sales comprised 21.8 percent of Game. The listed retailer said it woutd prionitise expansion into food retail and fresh categories through new storesi Massmart is currently waging a battle against fellow retailers Pickn Pay. Spar and Woolworths: The group has alleged, at the Competition Tribunal that the major retallers were frustrating Game's national expansion ambitions as they had exclusivity ciauses at major mells Reduced dividend majormalls. Reduced dividend In the six months to June, Massmart's total sales were up 8.7 percent to R42.3 billion, while operating profit before interest was R819.1 million, up 19.5 percent. Headline earnings increased by 19 percent to R320.6m. Massmart reduced its dividend per share by 49.2 percent to 74.1 cents. In the six months, Massmart opened nine stores, On the other hand, the group closed seven stores. Hayward said some of the towns in which the group had stores had been affected by mine closures, hence the decision not to renew leases. Massmart, owner of brands such as Game, Makro, DionWired and Builders Warehouse, said it would embark on a measured sub-Saharan African expansion through Builders Warehouse, Game and Masscash. Hayward said the company's approach to growth into the rest of the continent had always been measured as some African markets were volatile and risky. Thany countries in sub-Saharan Africa continue to struggle with the dual challenges of a strong US dollar and weaker commodity prices, A few countries saw severe currency weakness which Was compounded by shortages of foreign currency needed to settle imports into thoseccountries, Massmart said. It said it expected fo open a naws fore in Nigeria later this year: was compounded by shortages of fon in currency needed to settle imports into those countries," Massmart said. It sai it expected to open a new store in Nigeria later this year. In the six months to June, Massmart's total sales were up 8.7 percent to R42.3 bilfion, while operating profit before interest was R 819.1 million, up 19.5 percent: Headline earnings increased by 19 percent to R320.6m. Massmart reduced its dividend per share by 49.2 percent to 74.1 cents. In the six months. Massmart opened nine stores. On the other hand, the group closed seven stores. Hayward said some of the towns in which the group had stores had been affected by mine closures, hence the decision not to renew leases. Massmart, owner of brands such as Game, Makro, DionWired and Builders Warehouse, said it would embark on a meastred sub-Saharan African expansion through Builders Warehouse, Game and Masscash. Hayward said the company's approach to growth into the rest of the continent had always been measured os some African markets were votatile and risky "Many countries in sub-Saharan Africa continue to struggle with the dual challenges of a strong us dollar and weaker commodity prices. A fie w countries saw severe cumbncy weakness. Which was compounded by shortages of forlign currency needed to set tie imponts into those countries, Massmart said is said it expectedito onen new store in Nigena laterthis year: Source: https://www.iol.co.za/business-report/companes/massmart-wants. to-expand-game-stores-2061212 1.1 Massmart is not alone in the Retail industry expansion across Africa; there are other several players too. With reference to this statement:" With reference to the above statement, critically analyse the forces within the macro environment of business and discuss the impact of each on Massmart business. 1.2 Critically examine how competitive forces in the industry have shaped Ackerman's strategy