Retail spend recovered in the last quarter of 2016, but experts warn that the sector remains fragile. Retail experts have warned that raising interest rates, Rand depreciation will further strain consumer disposable income in the coming months will likely hit the sector hard especially clothing retailers.
A new report by Ernst and Young shows that South Africa’s retail sector was robust last year despite the country seeing its weakest growth in seven years. The sector however is likely to weaken in the next few months as consumer disposable income comes under pressure.
Retail partner at Ernst and Young Derek Engelbrecht says consumers have been under pressure over the last two years.
In the last quarter of 2016 and first quarter of 2017 some of those external pressures have become heavier or worse and the consumers are being forced to make some very astound buying decisions. And when it hits on the currency it will again play a role. And particular the cost of debt and the ability to service that will hit on particular furniture and appliance retailers.”
http://www.sabc.co.za/news/a/22b1918040be031fa4abf5d9ce9b621f/Retail-spend-recovered-in-quarter-four-of-2016-20171104?platform=hootsuite
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