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Evidence of upturn in local retailing: SureSwipe

23 Dec 2011

Despite the Eurozone and the US economies reeling from crisis to crisis during 2011, and high levels of unemployment in SA, there has been evidence of an upturn in local retailing, according to SureSwipe, an independent credit and debit card swipe machine distributor.

"What we are seeing is an end to strong negative spending patterns of the last two years and a slow, but definite improvement in confidence and spending.

"While this won't be a 'great' Christmas for retailers, it definitely will show a marked improvement on the last two years," said Paul Kent, managing director of SureSwipe on Thursday.

While projections in the US point to stagnant retail spending or a lift of less than 3%, Kent believes that figures will be better in SA.

"South Africans as a whole never bought into the culture of excess seen in the US and so consumers and the economy are more resilient. We find it easier to cut back and then to recover," he commented.

According to SureSwipe, fewer people will go on holiday this year and will invest more in home entertainment like game consoles, televisions, handheld computers.

Bonuses used to buy appliances

"Sales of these are up 14% this year and they will probably edge up 3%-5% this month," SureSwipe said, adding that this was also the time of year when people were most likely to buy a new electrical appliance with their bonus.

"In December 2009 to November 2010 we saw electrical appliance sales grow 86%, and then plummet to only 20% last year, but comparing December 2009 to December 2010 there was still a 37% up-tick in sales for these items, and we predict that figure will rise to just over 40% this season," it added.

Interestingly, the area that has shown the most worrying decrease is for food and beverages, Kent says that consumers can't cope with high food costs and it is here that many are far more budget conscious.

"We're pretty sure that the trend will continue for the foreseeable future - what that means is that consumers no longer see the value in buying in bulk and storing.

"They don't have that sort of money any more. They are very price conscious now and are shopping carefully and buying only when they need it. The days of having a big deepfreeze and keeping it full are gone for most," he said.

Source: I-Net Bridge

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