South Africa Retail Report Q2 2012 - Research and Markets

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South Africa Retail Report Q2 2012

Description:    South Africa Retail Report provides industry professionals and strategists, corporate analysts, retail
                associations, government departments and regulatory bodies with independent forecasts and
                competitive intelligence on South Africa's retail industry.

                BMI forecast that South Africa’s retail sales will grow by 47.4% from ZAR683.91bn (US$82.68bn) in
                2012 to ZAR1.01trn (US$121.90bn) in 2016. Key factors behind this expansion will be underlying
                economic growth, rising disposable income, falling unemployment, increasing urbanisation and the
                emergence of a black middle class, which leading retailer Edgars Consolidated Stores estimates has
                more than doubled in size since 2000. South Africa’s nominal GDP is forecast to come in at
                US$395.0bn in 2012, with real GDP growth of 2.7% forecast for the year, down slightly on 2011’s
                real growth rate of 3.1%. Average annual real GDP growth of 3.4% is predicted by BMI between
                2012 and 2016. With the population increasing from an expected 50.7mn in 2012 to an estimated
                51.7mn in 2016, GDP per capita is forecast to rise 41.7% to US$11,031 over the same period.

                Consumer spending is being lifted by foreign visitors to South Africa. Following a difficult 2009,
                foreign visitor numbers are again on the increase. Boosted by the FIFA 2010 World Cup, the
                country recorded a 15% increase in tourist arrivals in 2010 to 11.34mn. The most recent data, for
                January-August 2011, show a modest 2.6% increase in tourist arrivals compared with the same
                eight-month period a year earlier. Tourist expenditure is expected to have risen to US$12.90bn in
                2011 from US$11.63bn in 2010, and BMI forecasts it to increase further to US$14.09bn in 2012.

                In 2005, 64.1% of the South African population was described by the UN as economically active,
                with 36.8% in the 20-44 age range, which is crucial for retail sales. By 2015, 64.3% of the
                population is expected to be economically active, while the proportion of those in the 20-44 age
                range is forecast to reach 38.0%. Growing urbanisation is also contributing to the vibrant retail
                sector, with a 26% increase in the number of urban households between 1994 and 2005. In 2005,
                less than 58% of the population was classified by the UN as urban, but this is forecast to increase
                to more than 64% by 2015.

                According to BMI data, sales of consumer electronics are expected to increase from US$9.43bn in
                2012 to US$13.50bn by the end of the forecast period in 2016, a rise of nearly 51%. South Africa’s
                techliterate, high-end consumer electronics market is the largest in Africa, and youthful
                demographics, rising incomes and a regional economic boom should all support expansion. Sales of
                over-the-counter pharmaceutical products are forecast to grow by nearly 41%, from US$0.45bn in
                2012 to US$0.63bn by 2016.

                Vehicle sales are forecast to rise by more than 75% from an expected 686,456 units in 2012 to
                1.20mn units in 2016. The size of the country, significant rural land coverage and the agricultural
                sector provide a substantial market for four-wheel drive vehicles, light pickups and SUVs. We
                estimate that overall food consumption in South Africa in 2011 will account for 55.8% of total retail
                sales worth an estimated US$46.17bn. This is forecast to increase to 56.1% of overall retail sales
                by 2016, when the sector will be worth US$68.41bn. The South African mass grocery retail sector,
                comfortably Africa’s largest in terms of value, is forecast to be worth US$28.76bn in 2012. BMI
                expects its value to rise to US$43.59bn by 2016.

                Retail sales for our set of Middle East and Africa (MEA) countries in 2012 are forecast to reach
                US$367.85bn, based on varying national definitions. Total consumer spending for the region, based
                on BMI’s macroeconomic database, is forecast at US$1.0trn. In 2012, BMI predicts that South
                Africa and Saudi Arabia will together account for an estimated 66.6% of regional retail sales, with
                Israel accounting for a further 11.7%. By 2016, the combined share of South Africa and Saudi
                Arabia is expected to amount to 65.4%. South Africa’s predicted 2012 market share of 22.5% is
                expected to rise to 23.3% by 2016. We put growth in regional retail sales for the period from 2012
                to 2016 at 42.1%, or an average 14.7% per annum.
Contents:   Executive Summary

            SWOT Analysis
            South Africa Retail Business Environment SWOT
            South Africa Political SWOT
            South Africa Economic SWOT

            Market Overview
            Current Trends
            Key Players

            Industry Forecast Scenario
            Consumer Outlook
            Retail Growth Outlook
            Table: South Africa Retail Sales Indicators, 2008-2015
            Table: Retail Sales Breakdown By Key Segment, 2012f
            Macroeconomic Outlook
            Table: South Africa – Economic Activity, 2011-2016

            Regional Retail Outlook
            Table: Middle East And Africa Retail Trends, 2009-2016
            Table: Middle East And Africa Regional Retail Sales, 2009-2016 (US$bn)
            Table: Share Of Regional Retail Sales, 2009-2016 (%)
            Current Trends

            Business Environment Outlook
            Middle East And Africa Business Environment Ratings
            Table: Middle East And Africa Retail Business Environment Ratings
            South Africa Retail Rating
            Limits To Potential Returns
            Risks To Realisation of Returns

            Mass Grocery Retail
            South Africa Mass Grocery Retail Industry SWOT
            Market Overview
            Industry Forecast
            Table: Grocery Retail Sales By Format, 2010 & 2020f
            Table: Mass Grocery Retail Sales By Format – Historical Data & Forecasts, 2009-2016
            Industry Developments

            Consumer Electronics
            South Africa Consumer Electronics Market SWOT
            Market Overview
            Table: Consumer Electronics Overview, 2008-2016
            Table: AV: Demand, 2008-2016
            Mobile Handsets
            Table: Mobile Handsets: Demand, 2008-2016
            Industry Forecast Scenario
            Consumer Electronics Market
            Table: Consumer Electronics Overview, 2008-2016
            Industry Developments

            South Africa Autos Industry SWOT
            Market Overview
            Industry Forecast Scenario
            Table: South Africa Autos Sector – Sales And Production, 2010-2016
            Table: Investments Made During H111
            Industry Developments
            Table: Top 10 Best Selling Passenger Car Brands in South Africa, August 2011
            Table: Top 10 Best Selling Commercial Vehicle Brands in South Africa, September 2011

            BMI Methodology
            How We Generate Our Industry Forecasts

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