“I would be overexposed to the clothing retailers not because their updates have been good but mainly because their prices have actually traded down significantly in the last few months. On a pricing level, all the clothing retailers are looking much cheaper,” van Zyl, a senior industrial analyst at OMIGSA, told CNBC Africa on Thursday.
A number of retailers have reported a decline in revenue growth as household budgets tightened and personal debt levels rose. Van Zyl believes the difference might be where the retailers place themselves in the market.
“The food retailers do seem to be doing worse than the clothing retailers at this point in the cycle. I’m not exactly sure why but I think partly to do with that fact that such a large amount of the food retailers are also going to the lower end. The upper end is feeling ok and they are larger clothing buyers so that might be explaining some of it,” she said.
Van Zyl added that while market growth does look weak, she would prefer to see it as a slow growth rather than no growth at all.
“There’s not a huge amount of growth coming from the world to actually support us so maybe the one driver we would have is that we’ve got a weakened rand and possibly manufacture could grow a little bit but that doesn’t last long because eventually that seeps through into inflation. We see it as a slow growth environment not a negative growth environment for the consumer.”