What is driving south Africa's retail landscape_Christy Tawii_The Great Shopper Insight Briefing

WHAT IS DRIVING SOUTH AFRICA'S RETAIL LANDSCAPE?

18 SEPTEMBER 2013, JOHANNESBURG

THE GREAT SHOPPER INSIGHTS BRIEFING

CHRISTY TAWIIRESEARCH ANALYST

http://www.euromonitor.com/

© Euromonitor International

2

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London

Singapore

Shanghai

Dubai

Vilnius

Cape Town

Santiago

Tokyo

Sydney

Chicago

Bangalore

London

Chicago

Singapore

Shanghai

Dubai

Vilnius

Cape Town

Santiago

Tokyo

Sydney

Bangalore



3EUROMONITOR INTERNATIONAL: MAKING SENSE OF BUSINESS INTELLIGENCE

OVERVIEW OF THE RETAIL LANDSCAPE

RETAIL CHANNEL PERFORMANCE

DRIVERS AND RESTRAINTS

PROSPECTS



4

2010 2011 201211,500

11,700

11,900

12,100

12,300

12,500

12,700

12,900

13,100

11,980.1

13,020.2

13,162.8

Global Retail Value

Retailing global performanceEUROMONITOR INTERNATIONAL: OVERVIEW OF THE RETAIL LANDSCAPE

US

$ M

illio

n

Global retail sales went up by 1% in value in

2012

Annual growth remains unstable and is yet

to return to pre-recession levels

Non-store retailing was most dynamic, with

highest annual growth (5.2%) driven by the

internet

Increasing shift from traditional to modern

retailing

For 2013, Euromonitor International expects

growth to perform more positively at just

under 3%



5

The World vs South Africa

Global sales reached US$13,162,817.4 million

Of which South Africa accounted for less than 1%

EUROMONITOR INTERNATIONAL: OVERVIEW OF THE RETAIL LANDSCAPE



6

At ZAR740 billion in 2012, South Africa is one of

the key retail markets in Sub-Saharan Africa

Sales driven by store- based retailing,

accounting for 97.4%

Non-store –> Direct selling, vending,

homeshopping account for remainder

Value sales 2013 est.

Shoprite Holdings Ltd 11%

Pick’ n Pay Retail Group Pty Ltd

8.2%

Spar Group Ltd 6.7%

Massmart Holdings Ltd 5.4%

Woolworths Holdings Ltd 4.2%

Edcon Holdings Ltd 4%

JD Group Ltd 2%

Mr Price Group Ltd 1.8%

The Foschini Group Ltd 1.7%

Clicks Group Ltd 1.7%

South African Retail LandscapeEUROMONITOR INTERNATIONAL: OVERVIEW OF THE RETAIL LANDSCAPE

Store-based Re-tailing - 97.4%

Non-Store Retail-ing - 2.6%

Top Ten Retailers by Value Sales Percentage







PROSPECTS



8

Conve

nienc

e

Discou

nters

Foreco

urts

Hyperm

arkets

Superm

arkets

Traditio

nal G

roc.

Appare

l

Electro

/ App

lianc

e

Health

& B

eauty

Home &

Gard

en

Leisu

re/ P

erson

al

Mixed R

etaile

rs

Direct

Selling

Intern

etOthe

r0

20

40

60

80

100

120

140

160

180

18.0

2.48.8

18.0

151.5

164.0

89.4

10.2

35.5

48.5

25.9

53.6

8.43.3

24.3

ZAR

mill

ion

Grocery retailers continue to dominateEUROMONITOR INTERNATIONAL: RETAIL CHANNEL PERFORMANCE

Traditional grocery and supermarket retailers

remains key







PROSPECTS



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Drivers and Restraints in South Africa’s retail marketRETAIL LANDSCAPE AND DEVELOPMENT

Main Growth drivers

Main Growth limiters

Expansion of Retail

Infrastructure

Young Consumer Base

Rising Disposable Incomes

Growing Middle Class

Socio-economic Issues

Intensifying Competition

Household Indebtedness



11

Consumer

Convenience

Price conscious Informed

Aspirational

Consumers are increasingly becoming............EUROMONITOR INTERNATIONAL: CHANGING RETAIL LANDSCAPE



12

Which is boosting…….EUROMONITOR INTERNATIONAL: RETAIL CHANNEL PERFORMANCE

Multi-Channel

Footprint Expansion

Retail Partnerships

International Presence

Private Label

Internet Retailing



13

Global Internet Sales Performing StronglyEUROMONITOR INTERNATIONAL: CHANNEL PERFORMANCE - INTERNET RETAILING

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

100

200

300

400

500

600

-5%

0%

5%

10%

15%

20%

25%

30%

35%

Global Internet Retailing Sales and Growth

Internet retailing sales Internet retailing growthNon-grocery retailers growth Grocery retailers growth

Ret

ail s

ales

, ex

VA

T, U

S$

bn

% g

row

th, f

ixed

exc

h ra

te

Internet retailing is still smaller than major store-based channels. Sales topped US$500 billion in 2012, putting it on a par with discounters and forecourt retailers.



14

UK

Norway

Switzerl

and

Irelan

d

France

Austria

Belgium

New Zea

land

Hong K

ong

Italy

Chile

Israe

l

Portug

al

China

Greece

Costa

Rica

Mexico

Malays

ia

South

Africa

Egypt

India

Indon

esia

Camero

on0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

800.0

Internet retail spend in selected countries in 2012

US$7.8

US$760

Internet retail varies across countriesEUROMONITOR INTERNATIONAL: RETAIL CHANNEL PERFORMANCE - INTERNET RETAILING

US

$ pe

r cap

ita



15

South Africa’s Internet retailing still in infancy, but growing exponentially

EUROMONITOR INTERNATIONAL: RETAIL CHANNEL PERFORMANCE - INTERNET RETAILING

2007 2008 2009 2010 2011 20120

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1,413.61

1,679.37

1,965.37

2,351.67

3,028.35

3,642.51

Internet Retail Value Sales

ZAR

mill

ion

Only 11%

of South Africa’s Population in 2012 has

internet access

Lower base but most dynamic

Mobile devices pushing internet to the masses-

rising mobile internet retailing

Consumer electronics and video games

hardware leading sales

Grocery & apparel shopping catching up







PROSPECTS



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Globally the retail market is expected to grow by 18% between 2013 and 2018

Sales expected to top US$14,827 billion by 2018

South Africa expected outperform global growth at a rate of 25%

Global retail market in 2018EUROMONITOR INTERNATIONAL: PROSPECTS

World South Africa0

5

10

15

20

25

30

18%

25%

2013-2018 % growth



18

Convenience

Discounters

Forecourts

Hypermarkets

Supermarkets

Traditional G

roc.

Apparel

Electro/ Appliance

Health & Beauty

Home & Garden

Leisure/ Personal

Mixed Retailers

Direct Sellin

gInternet

Other0

40,000

80,000

120,000

160,000

200,000

240,000

22,931

3,54511,538

27,053

207,838

228,360

121,182

14,015

51,796

79,528

42,801

68,151

10,626 5,121 6,625

ZAR

Mill

ion

South Africa retail expected to achieve a CAGR of 5% by 2018EUROMONITOR INTERNATIONAL: PROSPECTS

Retail value sales expected to grow to ZAR 917.1 billion by 2018



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Consumers are expected to continue looking for…….

EUROMONITOR INTERNATIONAL: RETAIL CHANNEL PERFORMANCE

Modern Retailing

Convenience

Value for Money

For which retailers will have to offer:

Multi- channel shopping Internationalisation inline with aspirational brands

Production diversification and greater brand variety across all channels

Products at the right price for every consumer

Value-added servicesModern retailing expansion- grocery retailing expected to continue growing


THANK YOUChristy TawiiResearch AnalystTel: +27 21 524 [email protected]

mailto:[email protected]


What is driving south Africa's retail landscape_Christy Tawii_The Great Shopper Insight Briefing

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