SOUTH African retailers anticipate another contraction in sales volume growth during the upcoming Christmas period, continuing the momentum downwards from a year ago.
The good news for consumers though is that almost 30 percent of retailers say they reduced prices this festive season compared with a year ago.
Results from the latest Bureau for Economic Research-Ernst & Young Festive Season Retail Trends survey reveal that the holiday period, traditionally a boom time, may not improve the fortunes of domestic retailers.
Derek Engelbrecht, Ernst & Young Retail and Consumer Products Sector leader, said while the lower selling prices is good news for the consumer, combined with falling sales volumes this is wreaking havoc with retailer profitability.
A record 65percent of retailers surveyed indicated that their overall profitability was lower compared with the fourth quarter of last year.
This was the weakest fourth quarter in the history of the survey, since 1986, said Engelbrecht. - Adele Shevel