The 'steaks' are high: How Spur Corporation is navigating rising beef prices and fierce competition

Spur Corporation faced multiple challenges in the year to June as beef prices surged, loadshedding hit, political unrest flared in two African markets, competition from retailers intensified, and consumer spending remained subdued despite interest rate cuts.

Despite this, the casual dining group said it was confident its strategy would carry it through these pressures.

In its results presentation, Spur highlighted a 25% spike in beef prices following the foot-and-mouth (FMD) crisis. Loadshedding in Zambia, political unrest in Kenya, and currency devaluations also weighed on results.

As of July 2025, South Africa recorded 270 FMD outbreaks across five provinces, with 249 unresolved. KwaZulu-Natal was hardest hit, reporting 191 outbreaks, of which 172 remain active. Gauteng reported 32, North West four, and Mpumalanga three, the Department of Agriculture said.

Spur said strong supplier relationships and franchisee savings on product items helped mitigate the impact. The group operates 701 restaurants, mostly in South Africa, 25 in Zambia, and seven in Kenya, where political unrest affected operations.

Citing Visa and Discovery Bank data, Spur said spending on takeout and restaurant meals jumped 12% in 2024, outpacing an 8% rise in grocery spend. The increase reflects not only inflation but also growing consumer demand for convenience, with more frequent dining out and takeaways.

The group added that the South Africa Restaurant Market Report shows interest rate cuts by the Reserve Bank have supported consumer spending, creating a favourable environment for restaurants. However, disposable income and discretionary spending have yet to see significant improvement.

Spur also noted that competition is increasing, with supermarket retailers’ product offerings adding pressure.

Group CEO Val Nichas said Spur’s proven casual dining capabilities remain a strategic advantage.

“In the current environment of constrained consumer spending, we supported sales through value-added campaigns, brand loyalty programmes, menu innovation and offering customer experiences that differentiate. Consumers crave value, care, and memorable experiences that foster social connections,” she said.

Franchised restaurant sales grew 8.3% year-on-year, while Spur’s specialty brands – The Hussar Grill, Casa Bella, Nikos, Doppio Zero, Piza e Vino (including Ciccio) and Modern Tailors – grew 36.2%, the fastest pace in the portfolio.

During the year, 31 restaurants opened in South Africa and 15 internationally, while 15 closed locally and eight abroad.

Looking ahead, Nichas said lower inflation and interest rates provide some relief for debt-burdened consumers, while a stable electricity supply and forecast economic growth support confidence.

“These factors are unlikely to translate into improved consumer spending in the short to medium term, and we will continue our drive to gain market share,” she said.

The group plans to accelerate expansion with 42 new restaurants in South Africa and 14 internationally in the year ahead.