New Report Available: South Africa Retail Report Q3 2016.
South African retailers face an extremely challenging 2016, as the country's ongoing economic malaise combines with new affordability rules , limiting retailers ' ability to provide easy in-store credit. Despite this, over the medium-to-long term the outlook is brighter, as the economy slowly recovers and the crucial 20-39 year old demographic increases its population share. This segment of society is particularly important for fashion brands, given their high brand awareness. Moreover, an expanding middle-income population will assist retail growth across market segments in the long term.
Key Views & Developments
Confidence of South African retailers fell to a 15-year low in Q216, with just 26% stating they were satisfied with prevailing business conditions, according to the Bureau for Economic Research. This is down from 44% in Q116.
Full Report Details at
The Mall of Africa is set to reach, or even surpass, its first year turnover forecast of ZAR2.6bn (USD176mn). According to the Mall of Africa the key stores driving turnover were Woolworths, Checkers, Edgars, Game and DionWired.
South African retail holding company Steinhoff, owner of HIFi Corp and Ackermans, has confirmed it is considering a takeover of UK discount chain Poundland. Steinhoff took a 22.8% stake in Poundland in June 2016, and may be considering a takeover bid following two failed attempts to take over European-listed firms in 2016.
Retail sales growth in April 2016 disappointed market expectations, coming in at just 1.5% y-o-y compared to consensus estimates of 2.3% y-o-y. A stagnant job market, rising inflation and increasing debt-servicing costs have all acted as brakes on household consumption, a trend we expect to be maintained through 2016.
The South Africa Retail Report has been researched at source and features BMI Research's independent assessment and forecasts for the retail sector. The report examines key drivers of retail sales growth and future prospects, including consumer spending and private sector investment.
BMI's South Africa Retail Report also examines the level of development and potential for growth of the retail sector, the commercial initiatives of major players, changing consumer demographics that influence demand and the regulatory environment. Key sub-sectors include mass grocery retail, autos, over-the-counter pharmaceuticals, computers and consumer electronics.
Benchmark BMI's independent retail industry forecasts for South Africa to test other views - a key input for successful budgeting and strategic business planning in the South African retail market.
Target business opportunities and risks in South Africa through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
BMI Industry View
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|Date:||Jul 19, 2016|
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