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Trading density data from Broll SA managed shopping centres points to December as the top performing month compared to November and January over the last three years.
According to the Broll Retail Snapshot Q1: 2017, it appears that most South Africans continue to spend a lot more in December, attributable to the festive season trade in comparison to less spending in November and January.
However, certain retail categories such as Eyewear and Optometrists perform better in January. Black Friday and Back to School specials don’t appear to be having a massive impact on the market when compared to December’s Festive Trade, although slight differences were evident in November 2016 for certain retail categories. Black Friday has been growing in popularity and perhaps when more retailers take part in this one day promotion, more significant changes may become evident in the near future, explains Elaine Wilson, Divisional Director: Research for Broll Property Group.
According to the report, the best performing tenants in December were those in the Accessories, Jewellery and Watches category, although performance has been declining over the last three years likely due to consumers being under pressure. This was followed by the Food and Electronics categories. Sportswear and Outdoor tenants have been recording notable increasing trading densities in December over the last three years, an indication of fitness becoming more predominant in the market as is evident by the increased number of fitness facilities and events over recent years.
Retail executives across Broll managed shopping centres concur that December is always the best performing month with some centres achieving exceptional trade sales over this period. Others, report that apparel and back to school items seem to be on the December bonus shopping list for many consumers.
“High ticket items still remain popular as consumers rely on their December bonuses to “spoil reward” themselves,” says Jill Turnbull, Divisional Director for Property Management at Broll Property Group.
In the Eastern Cape, Broll Property Group’s Retail Portfolio Executive Nigel Hale says although December was the best performing month in rand turnover value, November was one of the best growth months for 2016 for various tenants. “December in Port Elizabeth always sees a benefit of the extra out-of-town visitors, along with the holiday season which increases tenant performance, usually to double the average turnover per month compared to the rest of the year,” says Hale.
He says Black Friday provided a month-end boost to many tenants, but maybe not to the level that was anticipated.
In KwaZulu-Natal, retail categories that performed well in December include Apparel, Electronics, Food Services, Health and Beauty, Homeware, Furniture and Interior, Speciality, Services as well as Sportswear and Outdoor. Some malls increased sales on 16 December, at the same time saw an increase in footfall and monthly achieved turnover, explains Theresa Terblanche: Broll Property Group Director for Property Management for Coastal Region (SA) and Mauritius.
“It would appear that Black Friday in November 2016 affected the trading performance in Food as well as Health and Beauty as in these categories, marginal growth showed when compared to November and December turnover data. Electronics and Homeware, Furniture and Interior categories decreased moderately when comparing December to January trading performance,” she says.
Terblanche notes that within KwaZulu-Natal retail sales for Sportswear and Outdoor as well as Homeware, Furniture and Interior increased over December, attributable to the festive season and possible remodelling of home. Tenants selling second-hand good also showed notable growth in sales and turnover in December.
Broll Retail Executives say while December was the best performing month compared to November and January, consumers have become more cautious to what they spend on and value retailers are seemingly doing well in the current economic environment.