The informal Sector

This week we carry an extremely interesting article addressing some of the issues around informal traders and their battle for market share with South Africa’s corporate retailers, who are now moving into townships. It may sound absurd that informal traders are competing with Pick ‘n Pay and Shoprite, but it is estimated that the combined sales of SA’s 750 000 informal traders (hawkers and spaza shops) is around R35 billion, which puts the three in the same league. On the one hand, you have a thriving sector that generates cash and puts it straight into the hands of the two or three people who run each of the 750 000 stores. The informal sector also provides a service to millions of people who have never been able to benefit from formal retailers. It seems a shame that it is becoming increasingly difficult for this sector to operate. On the other hand however, formal retailers create sustainable jobs that will enhance careers and create taxable salaries. Formal retail also contributes billions of rand in tax, all of which should used by the government to develop the country. In addition to this, formal retailers are also able to drive the prices of goods down through efficiency and scale. Is there perhaps a solution that will see the informal sector formalised without losing its roots that are so African? Let’s hope so. 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 Shoprite reissues cautionary notice Shoprite on Tuesday reissued a cautionary announcement that it was in talks that could affect the company's share price. The group first issued the cautionary in April and this is the fourth time it has been renewed. Analysts have speculated that management and private equity partners are trying to raise cash to buy out the retailer and delist it from the stock exchange. Informal traders take a knock as mass-market retailers move in The arrival of mass-market retailers at new shopping malls in townships is making life difficult for SA’s informal traders. Unless something is done, job losses are inevitable and these communities will begin to lose some of the wealth that has been built up over many years. According to the Bureau for Market Research, informal, survivalist business generated roughly R52bn in turnover in 2004, of which R32bn was made up of retail sales from 750000 informal outlets like spaza shops and hawkers. Read more. Retail sales growth slows as rate hikes kick in Retail sales growth slowed slightly in June, as the Reserve Bank began its cycle of monetary policy tightening. Retail sales, the main indicator of consumer demand, rose 9.1% year on year in June, down from May’s 10.2% rise, according to data released yesterday by Statistics SA. In the three months to June, retail sales were up 9.8%. Read more. Big turnout at Shopping Centre conference The 11th African Congress of Shopping Centres, held from September 13 to 15 at the Sandton Convention Centre, drew a record 1000 delegates. The South African Council of Shopping Centres, which hosted the congress, said this endorsed the international status of SA’s retail industry and proved that international brand marketers increasingly considered the country a major world player. Read more. Cashbuild's profit disappoints Basic building materials retailer, Cashbuild, have reported disappointing profit growth, which it attributed to the devaluation of Botswana's currency. The company's net profit for the year to June increased just 7 percent to R90 million, while sales surged by 23 percent to R2.71 billion. Read more. GLOBAL NEWS Woolworths takes 10% stake in The Warehouse New Zealand group The Warehouse has announced that Woolworths of Australia has acquired a 10.0% stake in the company. 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Use Sonicare to experience noticeably better oral care and an invigorating feel that leaves your mouth with the cleanest possible feeling. Sonicare results are clinically proven and have already achieved worldwide recognition! Read more. NEW! New Clover Krush - another irresistible temptation New Clover Krush Apple is a 100% Pure Apple juice, made from the freshest and best quality apples available, giving it a unique, clear appearance and delicious taste. No sugar or sweeteners are added, and the product is enriched with Vitamins A, C and E to boost your immune system by keeping your cells healthy. Read more. NEW! Ceres Sparkling brings out the bubbly in glass! After the resounding success of the Ceres Sparkling range in the 340ml cans, Ceres is bursting onto the beverage market with the launch of Ceres Sparkling in a new elegant 275 ml glass bottle. With the launch of the new premium look of the sophisticated 275ml glass bottle, Ceres aims to offer a greater variety to the discerning consumer market in this beverage category. Read more. NEW! Nestlé Ice Cream launches exciting summer innovations for kids Nestlé Ice Cream is proud to introduce a brand new range of exciting ice creams for kids. Bang, Cola Float and Marshmallow Goo are sure to bring kids COOL FUN this summer! The launch will also be supported with an exciting consumer promotion commencing mid-October 2006. Read more. NEW! Five Roses and Freshpak Ice Tea now available in 1L family packs Five Roses and Freshpak Rooibos are delighted to announce the launch of their successful ice tea range in a 1L family pack. The latest design boosts the value proposition for the consumer as they can now bulk buy their favourite brand and enjoy on a daily basis with an option to store the rest for later, allowing them to savour the taste at their leisure. Read more. NEW! 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BRAND ACTIVITY Speed legends battle for new Yogi Sip flavour Two legends of speed, rugby’s Bryan Habana and swimming’s Ryk Neethling, battle it out together with shoppers over the table-tennis table to see which superstar’s Danone Clover Yogi Sip flavour stays on the supermarket shelves. Ryk’s playing to keep Yogi Sip Berry in the shops while Bryan wants Yogi Sip Mango to stay available. The Flavour Knockout pits two new Yogi Sip flavours against each other, and the winner will become a tasty part of the Yogi Sip range. Read more. NBL and Proudly South African join forces National Brands Limited has strongly supported Proudly South African Week, which took place from 18 to 23 September 2006. The company staged a host of Proudly South African-orientated activities at each of its operations and offices countrywide. Read more. Brand new school kitchen means healthy food for Umlazi learners The 1200 learners at Embokodweni Primary School in Umlazi can now look forward to wholesome meals, hygienically prepared in a brand new R200 000 kitchen built and equipped by Game Stores. This is the latest development in an ongoing partnership between Game and the school, started last year. Read more. Rainbow Nation Bears banquet a success for Children’s Hospital Trust The Rainbow Nation Bears Banquet was staged to raise funds for the Red Cross War Memorial Children’s Hospital. The gala event, which took place on 29 July in Johannesburg, saw eleven handmade teddy bears tug on the heart strings of the guests as they were auctioned off at the event. Freshpak Rooibos was involved as a platinum sponsor for the banquet. Read more.
WINE, BEER & SPIRITS Simonsig launches first Brut Rosé Simonsig Estate has added a blushing débutante to their lineage of award-winning Champagne style sparkling wines - Simonsig Brut Rosé 2005. This full flavoured dry Rosé enthralls with femininity and finesse as the latest addition to the celebrated MCC family of this legendary Stellenbosch landmark, expanding the range of styles offered by the estate. Read more. Kleinood open doors with launch of Tamboerskloof Syrah 2004 Gerard and Libby de Villiers are delighted to announce the launch of their Tamboerskloof Syrah 2004, the first vintage made from Kleinood’s own grapes, and the opening of their well-appointed tasting room. Kleinood’s neighbours include some of the finest names in Cape wine – Stellenzicht, Waterford, Dornier and De Trafford, which lies up-stream. Read more. Clos Malverne release their 'best Sauvignon Blanc ever' Clos Malverne has just released its 2006 Sauvignon Blanc - their best vintage of this variety to date, say the dedicated team at this award winning cellar. This outstanding wine scooped a coveted Diamond Award at the recent 2006 Winemakers Choice Awards, as did their Clos Malverne Auret 2003 (the farm’s flagship red blend). Read more. FEATURED RETAIL SERVICES Angle Orange Angle Orange is a young, dynamic Point Of Purchase Marketing company specialising in the design and production of merchandising systems and promotional displays. Read more. Uptown Design Uptown Design, established in 1996, is an agency offering real solutions to the growing need for hard working packaging design. Read more. ADVERTISERS Volcano captivates audiences with Toys R Us Roboreptile commercial Volcano Advertising recently created a riveting Toys R Us television commercial to drive sales for the newly launched Roboreptile, the next generation of robotic toys. The 30” commercial was shot on location in the Toys R Us Boksburg store and captivates audiences by creating a mysterious and suspense filled atmosphere. Read more. McM delivers quality music and advertising Reaching and captivating the buying public has proven progressively demanding. New technology, such as PVR, and the continuous stream of traditional advertising bombarding audiences has made communicating new developments to the public via these channels virtually impossible. McM is a new breakthrough in in-mall entertainment, currently reaching 7 million shoppers per month, worldwide, and growing. Read more.
EVENTS Gastronomica Knysna 2006 23 September - 1 October - Knysna Includes a professional chocolate and patisserie workshop hosted by American champion pastry chef En-Ming Hsu. Read more. Improving your Supply Chain Seminar 3, 5, 10 October - Durban, Cape Town, Johannesburg The primary objective of improving the performance of the supply chain can only be made possible through collaborative development and implementation of global business standards. Read more. Jozi Cheese & Wine Festival 6 - 8 October 2006 - Helderfontein Estate The Jozi Cheese & Wine Festival will provide a fantastic day 'in the country' for visitors at the beautiful Helderfontein Estate. Read more. Nedbank Cape Winemakers Guild Auction 7 October 2006 - The Lord Charles Hotel, Somerset West A selection of 44 rare and unique wines from some of South Africa's most sought-after wineries. Read more. Robertson Wine on the river Festival 20 - 22 October 2006 - Robertson The Festival will offer visitors a comprehensive showcase of the Valley's wines from 40 wine farms. Read more. RMB WineX Gauteng 24 - 27 October 2006 - Sandton Convention Centre RMB WineX 2006 represents the entire spectrum of Cape wine producers showcasing every wine route in the country. Read more. 2006 CGCSA Conference and Marketplace 31 October - 1 November - Sandton Convention Centre This year's conference theme is focused on market development through brand innovation and strategic collaboration. Read more. Good Food & Wine Show 2 - 5 November 2006 - Gallagher Estate South Africa's largest food, wine and lifestyle celebration. Read more. Jordan Open Day 18 November 2006 - Jordan Winery Following on the success of their first Open Day in 2004, Gary and Kathy Jordan, along with the rest of their team at Jordan Winery in Stellenbosch, will again be hosting this popular event on 18 November 2006. Read more. Retail Loss Prevention Africa 2006 7 - 10 May 2007 - Sandton Convention Centre Focused on delivering expert experience and know how for ensuring you reduce your losses and stock shrinkage. Read more.