Woolworths Holdings Ltd. is selling more clothes at full price at its South African clothing unit even as international online-only apparel rivals such as Shein and Temu are changing local shopping habits.

The Cape Town-based seller of both fashion and designer clothing has struggled for years to get its fashion mix in South Africa right. The battle to turn that unit around has been made all the more difficult by congestion at the country’s ports, with the late arrival of some seasonal ranges meaning it’s had to offer discounts to sell the garments.

Chief Executive Officer Roy Bagattini believes that unit is now coming right with markdowns more than halving to about 10% of sales.

“Full-price sales is a very important metric, and it’s a good proxy for what extent are you getting your product right,” Bagattini said in an interview Wednesday after Woolworths reported annual revenue of 77.3 billion rand ($4.3 billion), which beat the average analyst estimate. Still, the Country Road unit in Australia showed a slowdown in sales. 

Woolworths’s food unit, which already accounts for more than half of revenue, will add 20 stores this year.

“We are very discerning about where to put space down – we don’t just land grab,” Bagattini said. “We look for profitable space extension.”

Slowing inflation is boosting volumes and there are signs that the most extreme cost pressures in food are easing, notably excess diesel costs for electricity, he said. This is important for Woolworths because it sells a lot of fresh food which needs fridges to ensure cold storage.  

The company is also pushing into food services, opening cafés and coffee carts.