The next two weeks will show how well South Africans are coping financially, say economists

Analysts will be closely watching how South Africans spend during this year’s Black Friday as an indication of just how willing and able consumers are to part from their income, says Debbie Law, retail sector head at corporate and investment bank RMB.

While retailers are better prepared for Black Friday sales compared to 2020, Law said that the past 18 months has been ‘transformative’ for consumers.

“For most of 2020, work-from-home meant that people weren’t travelling as much and saved on transport costs. The significant drop in interest rates during 2020 helped boost disposable income and put more money back in household pockets. There were a number of social grants made available to help support households and maintain spending behaviours.

“Additionally, the nature of lockdown – which restricted consumer movement – meant that spend on entertainment and out-of-town holidays was significantly reduced and household spend was directed into alternate retail purchases,” said Law.

However, she noted that South Africa is now 19 months into lockdown and many of the ‘extra’ household funds have either been absorbed into adjusted household spend or have come to an end like some of the grants. And as people return to work, room has to be made for transport and other travel costs again.

“Despite many people being re-employed again, the country is still suffering from a significant net loss of jobs from lockdown restrictions which have been further exacerbated by the recent KZN riots and related job losses.

“All of this is placing pressure on consumers’ disposable income and willingness to spend. Consumer spend, according to the South Africa Reserve Bank (SARB) for 2021Q2 is below 2019Q2 and indications are that 2021Q3’s spend numbers are also soft.”

Consumers’ enthusiasm to part with their money is still dampened and this may carry through into the festive season spend for this year, Law said.

“The personal savings rate has decreased from 0.7% (Q2’21) to 0.3% in Q3’21 and we have noticed lower spend on discretionary items and higher non-discretionary spending.

“This drop in savings, along with the pick-up in non-discretionary spend, could suggest that there is less household money around and hence consumers are dipping into funds previously allocated to savings, to keep heads above water,” Law said.

Black Friday will be a key tell

This year’s Black Friday sales are predicted to out-perform the levels in 2020, according to insights gleaned from BankservAfrica’s recent Point-of-Sale and ATM data. However, the jury is out on whether sales will exceed levels seen prior to lockdown in 2019.

To help drive sales in 2020, major retailers extended Black Friday specials to the entire month of November. But the economic impact of Covid-19 and lower consumer confidence, together with the stronger preference for digital shopping, contributed to sales being different to previous years.

“The average consumer transaction value is down to a nominalised value of R422 from R457 in October 2020. With all-time high petrol prices and salaries falling below the inflation rate, South African consumers remain under pressure,” said Mike Schüssler, chief economist at

“Still, with the economy’s better performance compared to 2020, we expect November’s card sales and ATM withdrawals to surpass the previous year’s Black Friday as specials once again run throughout the entire month of November as well as on Black Friday,” said Schüssler.

He added that the current global supply chain crisis could disrupt the stock of high-value goods, such as mobile phones and cars. Another negative impact could be the current load shedding. On the upside, the extra payments from the recent municipal elections could drive up spending,” he said.

“Despite the stronger sales predicted, it is unlikely that this year’s Black Friday will reach the 2019 levels,” said Schüssler.

Read: Pick n Pay launches early Black Friday deals

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The next two weeks will show how well South Africans are coping financially, say economists