Black Friday ‘could swing either way’ – economist
Efficient Group economist Dawie Roodt says this year’s Black Friday won’t be as predictable as the previous one in 2019.
This comes in light of the country’s lacklustre economic growth in the past few months – a bad situation made worse by the Covid-19 pandemic.
Consumers are expected to rush to stores tomorrow but others are expected to shop in the comfort of their own homes as many shops launch online specials.
Black Friday, which has taken the retail sector by storm, offers goods and services at lower prices during a select period in November each year.
But Roodt says this year’s Friday-rush could swing either way.
“There are a number of factors working in favour of higher sales on Black Friday and there are number of factors working against them. One of the factors working against them is that the South African economy is in deep depression and people simply don’t have the money so from that point of view, it’s likely that we’re going to see less sales on Black Friday than say for example a year ago.
“That’s another factor working in favour of Black Friday and then of course people think they’re going to get really good buys, especially when finances are a little bit buck people try to see if they can stretch the rand as far as they possibly can,” says Roodt.
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This was up from 3% in September. Stats SA said the unexpected rise in consumer inflation was driven by food, non-alcoholic beverages, housing and utilities. "Consumer inflation hit a seven-month high of 3,3% in October, driven largely by rising prices in food and non-alcoholic beverages.
Roodt predicts that if spending is high during Black Friday then sales during the festive season will be lower.
“The current lockdown or Covid-19 certainly is going to have an effect but it’s probably going to be really positive for online shopping so because of the virus I think more people are likely to try and buy online in order to try stay safe.”
He says despite consumer spending having a positive impact on the GDP, South Africa might not win all that much because the country’s markets rely heavily on imported goods.
“The biggest chunk of the economy is because of consumer spending, about 60%, and any consumer spending will be a big support for the economy. Unfortunately for us in South Africa we have been importing for the past couple of years which means many of the things we’re going to buy on Black Friday will be things imported from countries like China.”
Trends in previous years have shown that South Africans fall for bargains and lower prices which sometimes results in excessive spending.
