{"id":817891,"date":"2025-03-24T12:30:00","date_gmt":"2025-03-24T10:30:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=817891"},"modified":"2025-03-24T12:27:29","modified_gmt":"2025-03-24T10:27:29","slug":"a-decade-high-for-retailers-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/817891\/a-decade-high-for-retailers-in-south-africa\/","title":{"rendered":"A decade high for retailers in South Africa"},"content":{"rendered":"\n

According to the latest Retail Survey from the Bureau for Economic Research (BER), business sentiment in the sector remains generally positive despite some emerging risks.<\/p>\n\n\n\n

The BER highlighted that although certain businesses experienced a slight dip in confidence, the overall outlook for retail and motor trade indicates continued growth in the first quarter of 2025.<\/p>\n\n\n\n

The report showed that overall retailer confidence edged down slightly from 54% to 50% in the first quarter, reflecting a slowdown in positive momentum.<\/p>\n\n\n\n

“However, this level remains 10 percentage points above the long-term average, and the BER notes that half of the surveyed retailers remain satisfied with prevailing business conditions,” it said. <\/p>\n\n\n\n

This sentiment follows the positive retail sales data from Stats SA, which showed a 5.4% year-on-year increase in the fourth quarter of 2024. <\/p>\n\n\n\n

“Growth was broad-based, with semi-durable goods leading the way at 7.7% year-on-year, followed by non-durable goods at 6.5%,” the bureau added. <\/p>\n\n\n\n

The BER suggests that this strong performance was supported by lower inflation, improved consumer confidence, and the impact of two-pot retirement withdrawals, which provided additional spending power.<\/p>\n\n\n\n

Although retailer sentiment dipped slightly in the first quarter of 2025, the retail sales volume index remained steady on a seasonally adjusted basis. <\/p>\n\n\n\n

At 8 index points, this measure is at its highest since the fourth quarter of 2014, indicating the potential for continued, albeit modest, year-on-year growth.<\/strong><\/p>\n\n\n\n

One of the standout positives in the BER report is the sharp improvement in the confidence of new vehicle dealers. <\/p>\n\n\n\n

Confidence in this sector increased by 29 percentage points to 52%, driven by a marked surge in new vehicle sales volumes. <\/p>\n\n\n\n

The BER attributes this boost to lower interest rates and the use of retirement withdrawals for vehicle deposits. <\/p>\n\n\n\n

Naamsa data for January and February 2025 support this view, confirming the continuation of a sales rebound that began in October 2024. <\/p>\n\n\n\n

This renewed optimism within the motor trade sector signals improving consumer health, according to the BER.<\/p>\n\n\n\n

\"\"<\/a><\/figure>\n\n\n\n

In contrast, the wholesale sector showed signs of strain.<\/p>\n\n\n\n

After holding the position as the most confident sector for three consecutive quarters in the RMB\/BER Business Confidence Index (BCI), optimism among wholesalers retreated in the first quarter of 2025.<\/p>\n\n\n\n

Both consumer and non-consumer goods wholesalers reported a decline in confidence, accompanied by falling sales volumes and deteriorating business conditions. <\/p>\n\n\n\n

The BER highlights concerns about US trade policy as a significant factor weighing on sentiment within this group.<\/p>\n\n\n\n

Despite a record level of confidence among semi-durable goods retailers\u2014the highest since before the global financial crisis\u2014overall retail confidence was held back by declines in other categories. <\/p>\n\n\n\n

“Confidence among non-durable goods and furniture retailers fell despite strong sales volumes,” said the BER.<\/p>\n\n\n\n

The bureau noted that this discrepancy might stem from the sample’s skewed favour of smaller retailers, who face tougher conditions than larger grocery chains. <\/p>\n\n\n\n

However, hardware retailers maintained a positive outlook, and forward-looking indicators echo the cautious optimism seen in the BER’s second-quarter building survey.<\/p>\n\n\n\n

Price dynamics also shifted during this period. The BER reported that total retail selling and purchase price indices increased significantly compared to the fourth quarter of 2024, particularly for non-durable and semi-durable goods. <\/p>\n\n\n\n

These adjustments are likely due to routine pricing changes and the impact of a weaker rand. The rand averaged R17.60\/$ during the fourth quarter of 2024, but it depreciated to R18.40\/$ during the most recent survey period. <\/p>\n\n\n\n

Looking ahead, the BER’s survey results suggest that while retail and motor trade still have room for growth, the outlook for the second quarter of 2025 is more uncertain. <\/p>\n\n\n\n

Although consumer windfalls from two-pot withdrawals have boosted spending, this temporary relief is expected to wane. <\/p>\n\n\n\n

Additionally, the South African Reserve Bank’s decision to hold off on delivering a fourth 25 basis point repo rate cut means that additional support from lower interest rates is unlikely.<\/p>\n\n\n\n

Adding to the uncertainty is the recently announced 0.5 percentage point VAT increase, which will be phased in over two years. <\/p>\n\n\n\n

The BER said this tax hike is a potential headwind for both retail and motor trade confidence. With consumers still in a fragile state of recovery, the additional cost burden could weigh on sentiment in the coming quarters. <\/p>\n\n\n\n

Despite these risks, the continued strength in vehicle sales remains a bright spot, suggesting that pockets of resilience persist in the South African economy in 2025.<\/p>\n","protected":false},"excerpt":{"rendered":"

The latest Retail Survey shows that despite a dip in retail confidence, the retail sales volume index is at its highest since 2014.<\/p>\n","protected":false},"author":92,"featured_media":817895,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[14829,10421,22101,853,1809],"class_list":["post-817891","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-ber","tag-naamsa","tag-retail-survey","tag-south-africa","tag-stats-sa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/817891","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=817891"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/817891\/revisions"}],"predecessor-version":[{"id":817898,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/817891\/revisions\/817898"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/817895"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=817891"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=817891"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=817891"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}