We review South Africa’s apparel market to provide insights into the market share contributions and growth prospects of the listed retailers. Our analysis shows that, over the past 16 years, apparel retail sales have expanded at a 6.7% CAGR, driven by average CPI inflation of 3.0%, per capita volume growth of 2.2% p.a., and population growth of 1.5% p.a.
Since 2011, the big five apparel retailers (PPH, MRP, WHL, TFG and TRU) have conducted a total of 29 acquisitions, with many occurring during periods of lower interest rates. These acquisitions have helped retailers diversify their product offering, but an opportunity remains for them to enter into underrepresented categories, like jewellery and sportswear.
Data collected from 44 malls in South Africa shows that the listed retailers have a significant presence in the super-regional and regional malls. However, when we analyse trends in trading space, we find that most retailers have been cutting space and reducing their average store size to boost trading densities. We believe they are cutting space because the pool of apparel chains with more than 10 stores in malls is limited, and it may be more feasible to open smaller-format stores, helping to improve trading densities overall.
The market share of Retailers’ Liaison Committee (RLC) members has declined in recent years, and we believe this was due to customers shifting to independents due to their perceived affordability. We initially thought that increased credit offerings by listed retailers would help to boost sales, but the combined contribution of credit sales among the big five apparel retailers fell from 24% in 2020 to 22% in 2024.