Retail Update

Growth in South Africa's retail sales slowed to 2,3% year-on-year (y/y) in December 2012 from a revised 3,6% in November 2012. Economists had expected subdued sales over the month, with growth forecast at 1,2%.

On a month-on-basis basis, Statistics South Africa (Stats SA) on 13 February 2013 said sales were up 1% in December 2012, and increased by 2,3% in the last quarter of 2012 compared with the same period a year ago (see table 1).

Anisha Arora, analyst at 4Cast said: "The importance of retail sales reflects the health of households' consumption and expenditure, so with the release showing that seasonally adjusted retail trade was down by 0,2% quarter-on-quarter in Q4, South Africa will again be relying on government spending and fixed investment to sustain positive GDP growth. We don't expect the retail figures will ease the environment for the MPC to cut rates, especially when inflation risks are somewhat on the upside with the new basket weightings coming into effect from soon to be released January 2013 CPI data."

Peter Attard Montalto, economist at Nomura said: "This number continues to indicate that there was some underlying strength into the end of the year in the economy though much of this is probably credit-supported. We are also seeing the impacts of a strong wage round with large real wage increases, before the story of 2013 hits, which will be falls in employment, in farming and mining in particular. This number has no effect on our view of rates on hold this year (2013).

This last piece of Q4 data puts our GDP bean count estimate at 2,1%-2,2% y/y." Slowing growth in sales adds to signs that fourth quarter economic growth should be weak.

Table 1: Key growth rates in retail trade sales at constant 2008 prices

The highest annual growth rates were recorded for:
All ‘other’ retailers (5,8%);
General dealers (2,6%); and
Retailers in textiles, clothing, footwear and leather goods (2,3%).


The main contributors to the 2,3% increase were general dealers (contributing 0,9 of a percentage point), retailers in textiles, clothing, footwear and leather goods and all ‘other’ retailers (both contributing 0,6 of a percentage point).
Retail trade sales increased by 2,3% in the fourth quarter of 2012 compared with the fourth quarter of 2011. The main contributors to this increase were:
Retailers in textiles, clothing, footwear and leather goods (3,6% and contributing 0,9 of a percentage point);
All ‘other’ retailers (5,4% and contributing 0,6 of a percentage point);
Household furniture, appliances and equipment (3,9% and contributing 0,3 of a percentage point); and
General dealers (0,8% and contributing 0,3 of a percentage point) (see table 2).

Table 2: Retail trade sales at constant 2008 prices for the latest three months by type of retailer



Source:

News 24, dated 13 February 2013

Stats SA, accessed 13 February 2013

Lewis Group posts lukewarm results

The Lewis Group has posted Lukewarm Results

In a trading update the Lewis Group who sells furniture and appliances posted lukewarm results of a 5.6% increase in revenue, and a 2.7% rise in merchandise sales for the quarter.

Ernest and Young have indicated that growth in retail sales volumes is likely to moderate further during the first half of 2013 as both real income growth and credit extension slow down.

10 Common Mistakes Retail Salespeople Make

10 Common Mistakes Retail Salespeople Make:

 

1. Failing to build a rapport with the customer. From a simple greeting to a little chat about niceties, non-sales directed small talk go a long way in developing an easier and more open mood in the customers;

 

2. Failing to establish customer's requirements;

 

3. Focusing on their own agenda instead of the customer's;

 

4. Not giving customers the majority of the air time.  You have been given two ears and one month, so use them accordingly;

 

5. Confusing "telling" with "selling". Not listening or not hearing what customers are saying, so first seek to understand before seeking to be understood;

 

6. Not knowing the prevailing promotions, specials, regular offerings; product knowledge and pricing;

 

7. Not differentiating the product/service/store/company enough to create additional value in the mind of the customer;

 

8. Selling too fast, trying to close before the customer is ready to buy;  

 

9. Fail to address objections properly; not realizing that satisfactory resolution of the objections is the shortest distance to closing a sale;

 

10. Not taking advantage of add-on sales, as soon as the main purchase is done, which is when customers are most ready to entertain them.

 

You can prevent these mistakes with the help from Master Retailing by attending any one of our many retail courses or by enrolling in any of our retail management distance learning programmes, just contact us at info@mretailing.co.za for further information.

www.mretailing.co.za

Food Retailer, The Spur Corporation Making a Meal Out Of It

Spur Corporation, the restaurant franchise group whose brands include Spur, Panarottis and John Dory's reported yesterday that sales across its portfolio had increased by 17.5% in the six months to December, with Panarottis being the tastiest of them all having grown their sales by 33.2%.

Ellies Sending Out Strong Signals

Ellies manufacturer, distributor and retailer has sent out strong signals by delivering a strong set of results.

Revenue is up by 56% and profit after tax is up by 106% as stated in its published interim results yesterday.

Ellies has already rolled out 51 "green shops within a shop" outlets and is now looking for an acquisition to strengthen its renewable energy business.

Well Done Shoprite!

Shoprite grew turnover by 13,8% to R46,7 billion for the six months ending December 2012 and growth on a like-for-like basis was 6,9%.

In an operating update it was stated that sales increased by 11,5%, and by 6,2% on a like-for-like basis. For the month of December 2012 sales were 10,8% higher than for the corresponding period. Internal food inflation was on average 4,3% compared with the estimated official figure of 5,9%.

The rand remained weaker against most other currencies, resulting in the group’s non-South African supermarkets achieving sales growth of 28,2% and, on a like-for-like basis, of 13,4%. At constant currencies rand turnover growth of 23,5% was achieved. "This growth came mainly from the lower LSM (living standards measure) groups," Shoprite said.

Shoprite said the furniture industry remained negatively affected by the present economic conditions and the group’s furniture division grew sales by 4,8% for the period. The financial results for the review period will be published on or about 19 February 2013, the group said.

Source:
Business Day, dated 14 January 2013

Vacancies

Our client who is a blue chip and leading fashion retailer in South Africa, is looking for a Branch Manager and Assistant Manager for one of their flagship stores based in Menlyn, Pretoria, Gauteng.

Previous Fashion Retail would be preferable:

Salary: Negotiable
Benefits: Medical Aid, Pension Fund and yearly performance incentives. Study loans and bursaries are also available to employees with children through their training foundation.

After a year's service, successful incumbent will be issued with company shares.

Interested candidates to please forward their CV to cv@mretailing.co.za to reach us by no later than 18 January 2013 and, please use the reference MPG.
If you are not contacted back by the latest 31 January 2013, please then take it that your application was not successful. We will however keep your CV on our database for future use and, will contact you should something suitable transpire.