South African retailers painted a rosy picture for the Christmas trading period, despite prior projections that they faced the bleakest festive sales season in nearly two decades.
Three retailers that have commented on sales performance over the period say sales volumes were better than expected easing a restless wait for festive sales updates.
Massmart, owner of chain stores such as Makro and Game, said sales for the 26-week period to December 28 were up 13,2percent to R22,8billion genuine growth in a tough consumer spending environment.
Massmart said comparable store sales increased 11,9percent.
Massdiscounters increased 12,9percent with inflation of 1,8percent; Masswarehouse increased 14,8percent with inflation of 11,9percent; Massbuild increased 1,4percent with inflation of 10,6percent; and Masscash increased 17,3percent with inflation of 15,9percent.
Grocer retailer Shoprite, expected to release its full trading statement tomorrow, said festive season sales were better than forecast.
Brian Weyers, the group's marketing director, was quoted by Sapa as saying: "Sales were better than forecast for the 2008 festive season and Shoprite achieved its budgeted figures for this period."
Pick `n Pay's comments last week suggested that it did not have a bad festive trading period either. It said it was "not disappointed" with festive sales and consumers showed "amazing resilience" and sales came in above forecasts.
Pick n Pay said the percentage of shoppers making last-minute purchases three days before Christmas was also far higher than in previous years.
"But, as was expected, consumers spent their hard-earned money wisely," the company said.
Comments from these three companies defy what industry players expected, with Luke Doig, a senior economist at Credit Guarantee Insurance Corporation, having predicted big discounts to spur sales.
But declining fuel prices and December's 50 basis point interest rate cut should have helped retailers implement price markdowns to wake some consumers up from their spending hibernation. - I-Net Bridge