Credit cooling the market
The South African apparel industry ended 2010 with a bang, following very strong performance during the festive season, making up for the slow trading environment that dominated much of the year. Many large retailers enforced more stringent credit control on consumers in 2009, which slowed sales somewhat, however, this has led to retailers performing better than expected during the economic downturn as they have more carefully managed the risks of offering consumers credit.
Cotton prices and China chaos
Cotton prices spiked at the end of 2010 and Chinese labourers are demanding higher wages. The combination of these two factors caused many suppliers and retailers serious problems, as sourcing cotton at usual (or even fixed) prices became impossible. The impact of the cotton shortage remains to be seen, however, South Africa coped much better than expected due to the Rand’s strengthening against major currencies at the same time, which very much offset the impact.
Walmart and Zara take on Africa
The confirmed entry of retail giants Walmart and Zara into the South African market is set for 2011. This will offer South African consumers more choice, however, it has not pleased the country’s labour unions. The effects remain to be seen, however, retailers appear unconcerned by Walmart’s entry. Zara on the other hand will tackle premium retailers head on.
Large retailers continue to dominate
Formal retailers continue to dominate the apparel market in South Africa, causing the local production industry to rise or fall depending on where they choose to place their orders. Sourcing internationally is the focus for 2011, getting representation as close to the source as possible, and cutting out middle men.
Quietly confident about the future
The large retailers have weathered the economic downturn and many saw signs of recovery as early as April 2010, while others have only recently felt an upturn. The economic conditions in the country are stable and appear positive going forward.
Explore the complete Table of Contents and get more details on the report 'Apparel in South Africa' @ http://www.reportsnreports.com/reports/135160-apparel-in-south-africa.html
Other new reports available for following with ReportsnReports.com:
- Apparel in Denmark @ http://www.reportsnreports.com/reports/135161-apparel-in-denmark.html
- Consumer Foodservice in Thailand @ http://www.reportsnreports.com/reports/135151-consumer-foodservice-in-thailand.html
