HOUSEHOLD DEBT

SHOPTALK

South African Household debt as a percentage of income has risen from 49.1% in 2002, to 65.5% at the end of 2005. As worrying as this is, it is still well below the many first word countries that have debt/income ratios of over 100%. It is the sharp increase that draws attention, and given the high (10.9%) growth in retail sales for March, there is little to indicate a slowdown.

Below you will read that credit cards have seen a 40% year-on-year growth in the past three years, and banks have little intention of slowing this growth given the aggressive marketing campaigns they have embarked on in recent times. The reserve bank has a difficult task when maintaining a balance between raising interest rates to cool consumer debt and keeping interest rates low to stimulate the manufacturing sector - a job they have done well to date however.

I believe that lenders, especially credit orientated retailers, need to be more vigilant when issuing credit, as strong performances will soon be forgotten should debt become unsustainable due to a rise in interest rates.

Craig Ballantyne
craig@fastmoving.co.za

Please feel free to make comments or raise new issues by emailing the editor
editor@fastmoving.co.za

NEWSBYTES

Pick 'n Pay picks Fruit & Veg
On Tuesday last week, Pick 'n Pay announced the finalisation of an agreement to purchase Fruit & Veg City. Fruit & Veg operates 86 corporate and franchise stores nationwide. Analysts have speculated that the purchase may well help the giant retailer regain lost market share in the fruit and vegetable sector.
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Premier Foods board in battle for driving seat
The executive chairman of black-empowered company Premier Foods on Wednesday reportedly accused unnamed members of his board of orchestrating personal attacks on him to grab the corporation that had become profitable for the first time after five years.
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Rainbow focuses on meeting consumer needs
Since the appointment of Miles Dally as CEO three years ago, Rainbow Chickens has undergone a restructuring that has refocused the organisation from a commodity-producing business into a consumer-orientated one. According to Dally, a consumer business is about people and brands - areas where he has devoted much of his energy by building brands and turning Rainbow into an organisation that people want to work for.
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SA up to their necks in Credit Card bills
According to reports in the latest Finweek, South Africans owe nearly R34bn on their credit cards with year-on-year growth running at levels greater than 40%. While the growth numbers are staggering, it should hardly be surprising, considering the aggressive growth strategies unveiled by the big four banks over the past two years.
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Brand magazines giving retailers the edge
According to Retail publishing specialist Alison Thomas, almost every supermarket in the UK has a free, specialist brand publication: they are without exception phenomenally successful - and empower the retailer as a media owner. The South African retail environment may not be as diversified as its UK counterpart but shoppers are just as susceptible to being won over by the store that offers more.
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GLOBAL NEWS

Wal-Mart sued in counterfeit case
Italian fashion group Fendi has sued Wal-Mart Stores in a US federal court, accusing the retailer of selling counterfeit handbags and passing them off as genuine at its Sam's Club warehouse stores. Wal-Mart has so far declined to comment on the case.

Carrefour to launch non-food online site
On June 19th, Carrefour will launch its new non-food online site www.boostore.com. The site will offer five groups of products: cultural, sport and leisure products but also flowers and household goods and in particular IT and multimedia products, all of them at very competitive prices (more than 200,000 SKu's will be offered).
(Planet Retail)

Tesco report rise in first quarter sales
Tesco has this reported that total group first quarter sales rose 10.4%. UK same store sales excluding fuel grew by 4.5% for the 13 weeks ended May 27th.
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FEATURED BRAND

Horlicks Horlicks is a delicious malt-based drink that can be enjoyed hot or cold. It consists of a unique blend of nourishing ingredients, which are scientifically formulated to provide vitamins, calcium and protein. Read more.

BRAND NEW

NEW! Introducing Bakers Romany Creams Mintier Choc The Bakersman is once again bringing excitement to the biscuit aisle with the introduction of Bakers Romany Creams Mintier Choc. Covered in crispy mint pieces, Bakers Romany Creams Mintier Choc has a stronger mint flavour, which provides a perfect accompaniment to the chocolate. Read more.

NEW! Discover the secret of perfect pasta with Denny Denny has launched a robust and authentic range of pasta sauces that take the Italian sentiment of 'stylishly simple' and 'uncomplicated' to heart. The new range is undeniably convenient to the consumer who is looking for a delicious meal that takes only a 'momento' to prepare. Read more.

NEW! The first energy cola from USN Energy Cola from USN is a unique, great tasting, low calorie carbonated drink, fortified with vitamins and metabolic enhancers to increase mental and physical energy. Experience a cola energy rush like never before! Read more.

NEW! Use the brush you can flush from Addis What could be easier? The all-in-one, Addis Flush Away Toilet Brush cleans and deodorises effectively and hygienically. Everything is in the brush - no more wet toilet bowl brushes, germs or messy bowl cleaner! Read more.

BRAND ACTIVITY

Win a Chevy Spark with Mageu Number 1 To celebrate the launch of the new Mageu Number 1 Strawberry Flavour, South Africa’s favourite drink and Sunday World, South Africa’s original tabloid, are giving away a Chevy Spark 5 Door Hatch L worth R62 000! Read more.

Makhatini triumphs again
Who can forget the legendary "Makhatini from Maritzburugh" Lunch Bar commercial? Lunch Bar has become a distinctive brand in the market since 1980 and remains a favourite in the minds of South Africans. April 2006 saw Cadbury introduce its newest commercial into the Makhatini success story with all the humour and valour we've come to expect from this fun loving Cadbury brand.
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Ciro Liquid solutions a huge hit at Hostex
Hostex, South Africa's largest food and beverage industry exhibition, took place from 31 May - 2 June in Cape Town. The Ciro Alliances stand was a constant hub of activity, offering visitors to the expo literally anything under the sun in terms of liquid refreshment; from hot chocolate to mango juice, tea to speciality coffees and everything in between.
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Canderel to partner with Vodacom Durban July Fashion Experience
Canderel on Tuesday last week announced its sponsorship of the Vodacom Durban July Fashion Experience. The event is synonymous with being at the forefront of South African fashion, and with the substantial increase in interest and a sustained growth in the fashion element of this event, Canderel and Vodacom Durban July Fashion Experience is a perfect match.
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Trinco takes part in the Young Community Shapers Promotion
The Young Community Shapers promotion is an uplifting initiative which is run by the Independent Cash and Carry Group (ICC). Trinco, which is produced by National Brands Limited, is one of the brands involved in this project, which encourages and rewards young people for positive involvement within their communities.
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WINE, BEER & SPIRITS

Swartland Winery offers wines for your lifestyle Whatever the occasion, Swartland Winery has a value wine to match it - one that will enhance the enjoyment of the company, food and event, without breaking the bank. The "Lifestyle" range has recently been re-launched with stylish new labels offering a modern look, whilst offering excellent value. Read more.

Worcester wine co producing first Braille wine bottles
Worcester Winelands, launched eight months ago to sell wine in the world's first Braille wine bottles, is ramping up its production to meet orders of about R6m. The idea behind the Braille bottles was an ambitious plan to rebrand Worcester and put it on the map.
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Cellar d'Or enters joint venture with well-known winemaker
New wine development, Cellar d'Or, has entered into a joint venture with well-known winemaker, Oliver Meckler of the award-winning Adler Wines. The deal appoints him as the in-house winemaker at the development when it opens its doors in March 2007. In addition, Meckler will be offering Cellar d'Or blending courses and functions to corporates and the public, as well as courses to learn how to make your own barrel of wine.
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Cape Legends Wines richly rewarded
The positive attention earned by Cape Legends boutique wines is playing a key role in raising visibility in an overcrowded market. Accolades such as the spate of gold medals on international and domestic shows earned by brands such as Stellenzicht, Neethlingshof, Lomond and Uitkyk, help wineries to stand out in a fiercely competitive market.
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Jo'burg Wine Show on track
Plans for the launch of the Jo'burg Wine Show are well underway with 68% of the exhibition space already taken up by wine producers and other wine-related players. The Jo'burg Wine Show will be held at Gallagher Estate from Friday 28 to Sunday 30 July 2006 and promises to provide a fun, unassuming atmosphere to learn, taste and buy local and international wines.
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FEATURED RETAIL SERVICES

The Alternative Consultancy Assisting clients in developing workable marketing plans and strategies, based on knowledge of both formal and informal trade and consumer sectors. Read more.

TFD Network Africa TFD are the forward-looking distribution company that keeps you in control of your outsourced distribution, thus growing your market position, brand strength and profitability. Read more.

Sainsbury Design A Through-the-Line Agency with specialist knowledge in Packaging Design. We offer a comprehensive range of services and strive to go beyond expectations, from creative execution, competitive quoting, to the high levels of services offered. Read more.

RETAIL SUPPORT

SAP Launches Governance, Risk and Compliance Management Business Unit to Lead New, Emerging Market SAP AG (NYSE: SAP) has announced the creation of a new business unit to empower customers with end-to-end solutions for governance, risk management and compliance (GRC), offering a holistic alternative to the fragmented GRC point solutions available in the market. Read more.

ProScan forms RFID Division ProScan Systems recently formed a Radio Frequency Identification (RFID) division to handle the growing demand for information and solutions on this latest technology. RFID is a complement to the industry's current barcode-based tracking systems, allowing companies to automatically track inventory throughout an entire supply chain. Read more.

Take advantage of the opportunities within your store Within seconds of potential customers crossing the threshold of your store, they respond to visual cues, including colour, graphics and signage. Therefore, it makes sense to use the floor, counter tops, painted walls and hanging banners to make a statement and attract clients to key areas you want them to focus on. Read more.

Packaging innovation deters product tampering
Product tampering has become a real challenge for retail businesses and is an occurrence that could harm unsuspecting consumers and lead to serious adverse health consequences. Following a spate of negative press, there has been a trend to incorporate packaging safety features as a standard for all consumable items that can be ingested by humans.
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FASTMOVERS

New Group Marketing Director for Cadbury Cadbury South Africa is pleased to announce the appointment of Geoff Whyte as their new Group Marketing Director. With over 12 years experience in the Marketing and Fast Moving Consumer Goods arena, Geoff brings with him not only extensive knowledge and expertise but also a passion for the industry.

FEATURED EVENTS

Cards Africa 2006 The Cards Africa 2006 conference is Africa's only director-level smart cards event dedicated to payments, transactions and loyalty. From 9 - 12 October 2006, senior executives within the cards industry will converge at Sandton Convention Centre, Johannesburg, South Africa, to address fresh and practical ideas on how to expand their businesses in the African continent. Read more.

EVENTS

Building Quality Information Conference
Due to popular request, the "Building Quality Information" Conferences have been cancelled and will be replaced in October with the "Improving Your Supply Chain" Conferences. This will give us an opportunity to address a wider topic and to follow up on the "Back to Basics" Conferences held last year. Please see our web site www.gs1za.org for more information or phone Delia on 011 789 5777.

Swartland wine, opera and Italian pasta evening
20 June 2006 - Cape Town
Join Swartland at the Societi Bistro at the V&A Waterfront for a night of wine, opera and Italian pasta with special entertainment from acclaimed tenor Jannie Moolman.
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Nederburg Exclusive Winter Dinner
24 June 2006 - Cape Town
An exclusive five-course dinner in Nederburg's historic manor house.
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Stakeholder Reputation Short Course
26 - 27 June - Johannesburg
This 2-day course explores how stakeholder relationships impact on the creation of organisational reputation.
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Finding the Fortune at the Bottom of the South African Pyramid
12 July 2006 - Parktown
Eighty20 brings you a fascinating overview of the low-income market in South Africa.
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SOCAP Breakfast Event
14 July 2006 - Fourways Crossing
Brad Arden, Director of TQ² Consulting: Building Team Intelligence at Work talks about "Service is a Team Sport".
Read more.

Annual Franschhoek Bastille Celebrations
15-16 July 2006 - Cape Town
A "great food and great wine" themed festival to be held in Franschhoek.
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Africa's Big Seven 2006
23-25 July 2006 - Midrand
An integrated exhibition platform that showcases food, retail and FMCG products together with the processes to manufacture them.
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Cleantex Africa 2006
23-25 July 2006 - Midrand
Africa's hygiene, cleaning, maintenance, pest control and facility management services exhibition.
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The Jo'burg Wine Show
28 - 30 July - Gallagher Estate
A three-day event affording the opportunity to learn, try and buy wines in a relaxed and unassuming setting.
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Nedbank Cape Winemakers Guild Auction
17 August 2006 - Camps Bay
Discover the exceptional wines South Africa's leading winemakers will be offering at the 21st Nedbank Cape Winemakers Guild Auction.
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The 3rd South African Red Bull Box Cart Race
27 August 2006 - Johannesburg
One cart, 4 team members, an operational steering wheel, functional brakes and a hooter…
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RMB WineX Cape Town
30 August - 1 September 2006 - CTICC
WineX offers a comprehensive showcase of over 1 200 wines per night from more than 200 of the country's top wineries.
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Good Food & Wine Show
2 - 5 November 2006 - Gallagher Estate
South Africa's largest food, wine and lifestyle celebration.
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THE FAST MOVING FACT

South Africans consume over five billion litres of alcohol per year. Statistics show that there is one liquor outlet (23 000 licensed and 200 000 unlicensed) for every 190 persons in South Africa.

For Fast Moving Fact submissions, please e-mail editor@fastmoving.co.za