S&V Weekly Newsletter Vol.5 No.28, July 15, 2019

This Newsletter is sponsored by SAFLIA

This week's quote: "When we start businesses, we must not worry about how government can help, but how we can find help from our fellows, and how we can, in turn, help others. We must cultivate a culture of responsibility. - Martin van Staden, the Free Market Foundation, in an article headlined If our salvation depends on personalities, we are in trouble. To read the full article, go to: www.freemarketfoundation.com

Please note: Click on any ad to go to the advertiser’s website

Retail last week

Comment from 5 retailers on Saturday
"It's quiet at the moment. People come in and take a look, but aren't buying much. Maybe it's the time of month. It's more-or-less the same as last year." - David Novos, manager, Economic Shoe Store, Paarl, W Cape, SA. Independent, 1 store, family footwear.

"The week overall has been quiet, but there has been a sudden burst of business this morning. Overall the month hasn't been too bad." - Shireen Ebrahim, director, Economics of Glencoe, Glencoe, KZN, SA. Independent, 1 store, family outfitter.

"Back-to-school is a quiet period for us, so this week has been quiet. The first quarter of the year was definitely slow, and April and May weren't great. June was better than last year, and July will depend on how school holidays fall - we do much better during the holidays." - Mubeen Dhorat, national manager, Eddie's Family Clothing, Pietermaritzburg, KZN, SA. Independent, 4 stores, family outfitter.

"The week started off with a bang because of back-to-school, then tapered off. We're basically on a par with last year so far, and looking forward to Black Friday, Christmas trading and back-to-school again in January. Matatiele has grown a lot, and many of the chains are here, so we've had to up our game, but it's a really lovely place." - Gerald Robins, buyer, Elegant Man, Matatiele, E Cape, SA. Mini-chain, 5 stores, family and school outfitter and sportswear and equipment.

"This week has been terrible, and the month as a whole has been quieter than the rest of the year. I've no idea why - normally I'm very busy on a Friday, but not this week. It's very unpredictable - sometimes I'm busy at month end, sometimes in the middle of the month, but this week, maybe people are fed up or hibernating or something." - Deborah Fontes, director, Elements Boutique, Johannesburg, Gauteng, SA. Independent, 1 store, women's boutique, men's accessories, and vaping accessories.

Factory closures: IDC responds

S&V asked the Industrial Development Corporation to comment on the closure of Cape Town factories in the leather industry. Spokesperson Zama Luthuli responded:
The recent liquidation of Jensen Belts is the fourth leather industry factory in Cape Town to go into liquidation or close in the last 4 or 5 years (the others were Uber Gruvi, Chic, and at the end of last year, Green Cross Manufacturing). All had been, so far as I know, heavily funded by the IDC. Is the current model that the IDC is using to fund footwear and leather goods manufacturing flawed by being too focused on upgrading manufacturing without developing sustainable markets?
IDC’s funding model considers the challenges facing the footwear and leather industry and includes assisting distressed businesses, however continuation of business’ is dependent on management as well as prevailing economic conditions.
The IDC has played a significant role in saving some of the jobs in the industry given the challenging economic environment.
       As you may be aware, consumer discretionary spend has dropped over the last few years and is anticipated to continue declining in the next two to three years. Due to, among other factors, a challenging economic environment, most consumers are prioritizing spend on essential items and/or opting for cheaper imported semi-durable products.
       Please note Jensen Belts and Green Cross did not receive IDC funding. However all companies mentioned received funding from the dti’s Grant Scheme, which is designed to increase competitiveness through improved manufacturing capabilities.
Should the IDC have tighter management control on businesses it is supporting?
Adequate due diligence is always conducted on any successful applicant for a funding facility. While we do keep a close watch and monitor performance of beneficiaries, we do not normally acquire equity in these businesses to influence their operations. As indicated, the challenging economic environment has largely impacted this industry.
Is there any news on Celrose and its footwear division, Eddels Shoes, and when (or if) the IDC plans to sell its share?
As you are aware, we just recently acquired Celrose. We remain a committed shareholder with absolutely no immediate plans to divest from the business.

Woolworths reports better performance

Thu 11 Jul 2019, 9:15 Woolies - extracts from a SENS trading update
The year ended 30 June 2019 ('current year') had 53 trading weeks compared to 52 trading weeks for the year ended 24 June 2018 ('prior year').
       In South Africa, after a 2.0% decline in sales in the first half, Woolworths Fashion, Beauty and Home sales performance improved in the second half, growing by 5.5% (5.0% after adjusting for the pre- Christmas trade day included in the second half), with comparable sales of 4.7%. This is as a result of a focus on core ranges and basics, backed by improved availability. Price movement for the year for Fashion was 2.5%.
       Retail trading conditions in Australia remain challenging. David Jones was also significantly impacted by sales disruption resulting from the Elizabeth Street store refurbishment, which is on track to be completed by the third quarter of the 2020 financial year. Online sales at David Jones grew by 46.8%, and now contribute 7.7% of total sales. In Country Road Group, while sales growth in the second half was also impacted by the trading conditions, online sales in Australasia grew by 12.9%, representing 20.3% of sales. As the contribution from online sales increases the reduction in unproductive space remains a priority.
       The Group's year-end results for the 53-week period ended 30 June 2019 are scheduled to be announced on the SENS on or about 29 August 2019.- For the full report, go to http://www.sharedata.co.za/v2/Scripts/News.aspx?c=WHL&sensid=339036

Movements

Cape Town, W Cape, SA – Odette Barrett has recently taken over the role as the Truworths ladies' shoes, bags and accessory buying manager.
         She is new to the shoes, bags and accessory department but has been with Truworths on the men's apparel side for almost 20 years.

They Said It

"I've followed up from here with the tracking number you gave me. They said I SHOULD ENQUIRE AGAIN NEXT WEEK. NO airmail service between SA and Namibia for more than 15 years." - Peter Meinzer, Thiel's Shoes, Windhoek, Namibia, writing on Friday. We posted him a Directory on June 26, supposedly by registered airmail. We deal with some dedicated people in the Post Office, but somehow the system just doesn't work very well.

"The heroin was neatly concealed in three packages inside the suspect’s leather briefcase." - Extract from a SARS news release on Friday about a drug bust at Cape Town International Airport. It's nice to know drug smugglers have taste - or are they the only people who can afford leather briefcases these days?

S&V Directory - Order now

The directory is ready. On sale for R450. The online version is also available at R450 for 12 months' access.

2019 Trade Fairs Another essential service from S&V

Please note that we have put a list of the 2019 trade fairs and conferences on our website, linked to their websites: http://www.svmag.co.za/events

Exchange rates

Source: http://www.x-rates.com/calculator/

ABSA Agri Trends 12/07: Hides & skins prices

Hides: R1.70/kg. The domestic hide market moved positively this week with a 2.1% increase in the calculated average hide price. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies. Dorper skins: R24.00/skin. Merino skins: R38.75/skin.

15/07/1933: Joe Powell, retired, formerly Footwork, Trafalgar.
15/07/1971: Philipp Rein, Rein Tanning, Mossel Bay.
16/07/1954: Lex Devlin, emigrated, formerly ACA Threads, PE.
16/07/1956: AR Noorbhai, Razno Agencies, Johannesburg.
16/07/1974: Marisca Ras, The Health Shoe Shop, Pretoria.
17/07/1947: Hennie van der Merwe, chairman, KKI board, Oudtshoorn.
18/07/1950: Magda Erlank, Me Boutique, Newcastle.
18/07/1963: Peter Colombo, formerly Hippo Bag & Screen [closed], Cape Town.
18/07/1973: Sanjay Bhagwandas, Ginger Bhagwandas Exclusive, Durban.
18/07/1974: Zunaid Gathoo, Shoe Zone, Sasolburg.
19/07/1946: Mohamed Iqbal Ahmed, A.V. Mohamed & Sons, Louis Trichardt.
19/07/1967: Fatima Do Tanque, Super Save, Aliwal North.
19/07/1968: Hussein Feyssa, Hafde Tannery, Addis Ababa, Ethiopia.
19/07/1977: Shantell Sables, Elan Polo, Cape Town.
21/07/1965: Gavin Cooke, Rebel Safetygear, Johannesburg.

In Memoriam this week

16/07/2004: Frederick (Fred) Howard (b. 16/02/1918), King Tanning Company [closed], King William’s Town.
20/07/????: Ivy Cunningham (b. 16/10/1919), In Step Shoes [closed], Pietermaritzburg.

Have you let us know about your birthday, or the birthdays of your colleagues? Our readers love this section, so please become part of it. This also applies to the In Memoriam section. Help us remember former colleagues.

Have a look at these links

We invite businesses to send us links to websites, Facebook pages and the like which they feel would be of interest to others. The links below are from our database:
Bare Necessity, women's sleepwear specialist, Cape Town, W Cape, SA: https://www.facebook.com/Bare-Necessity-Dean- Street-Arcade-Newlands-477447285719602/
Bargain Corner, odds-and-ends, East London, E Cape, SA: https://www.facebook.com/Bargain-Corner-South-East-London- 335825559864965/

Classified Adverts

Need Print?

Processlitho is a 100% fully black owned company. We specialize in Brochures , magazine, tri fold leaflets, posters, full colour prints & digital for short runs. Contact Abdul Alli, sales executive, 031 569 1020, abdul@processlitho.co.za, 130 Malacca Rd, Red Hill, Durban.

Contact us

News & Classifieds: Tony Dickson, +27 (0)31 209 7505, tony@svmag.co.za

Next newsletter: July 22, 2019.

SAFLIA enquiries: Tel 0800SAFLIA * Email info@saflia.co.za * Website http://www.saflia.co.za

Should you wish to subscribe email tony@svmag.co.za
Our website www.svmag.co.za