S&V Weekly Newsletter Vol.11 No.4, January 27 2025

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Finished goods suppliers: Current order situation (responses in company alphabetical order)

New designs, new accessories lift sales

Dewald Visagie, Group Sales, Design & Marketing Executive, Bolton Footwear
Cape Town, W. Cape, SA – Our Winter 2025 order book opened last year November for delivery January to June 2025. The first 6 months for 2024 delivered below average results which put tremendous strain on the company and employees.
     It is a new year and things are looking brighter. While it is early days, we are confident to turn the previous year (first 6 months) order book around. We introduced exciting new developments to our main brands Grasshoppers, Crocket & Jones, Bronx and Barker for 2025. We also broadened our offering in the brands with the introduction of accessories like travel bags, caps, socks, perfumes, etc. This extra category complemented our shoe offering and we can see the results in the order book for Winter 2025. We are already seeing a very positive growth comparing the same time last year. I expect this trend to continue for the rest of the year bearing in mind it is all about the right product offering at the right price. We will be more innovative and creative with the brands, focussing on advertising and being part of the social trends of the community.
     It is still very tough out there and the full recovery of the economy will take some time, but it can only be better than 2024.  We are all in this together and will continue maintaining strong partnerships with our retailers.

Successful, and fighting counterfeiters

Adrian Maree, director, Corrida Shoes
Pietermaritzburg, KZN, SA – The footwear segment in South Africa continues to operate under economically challenging conditions; however, there are clear signs of improvement. We are fortunate to find ourselves in a positive position, with our order book looking exceptionally strong. After an excellent 2024, we are excited to carry this momentum forward and continue driving success in 2025.
     One highlight has been the remarkable performance of Omega Original. It’s the brand that’s flying off the shelves and gaining significant market share across retailers’ stores. Unfortunately, this success has also made it a target for counterfeiters. We’ve faced attempts to knock off Omega Original, but we’ve taken aggressive legal action to protect our brand and intellectual property as well as jobs in South Africa. Protecting what we’ve built remains our top priority, and we will continue to litigate against any attempts to undermine our hard work.
     Despite these challenges, the future looks bright, and we’re optimistic about the road ahead. We remain committed to innovation and quality while contributing to a sustainable footwear industry in South Africa.

Taking a calculated risk in a soft market

Robby Stoller, MD, Dangee Carken
Johannesburg, Gauteng, SA – Our current order position for the W25 season is in line with the declining demand we have seen over the past year. Orders have been conservative, especially due to the soft winter season we experienced last year. My understanding is that due to this situation the winter boot offering is very small from the trade at large. We on the other hand have taken an opportunistic view and have brought in a full collection of ladies boots, expecting the trade to support us due to our on-trend fashion offering and newness that the consumers demand from our brands.
     Fashion is king and we are confident we will lead the charge.
     On our men’s side, we have latched onto winning fashion that performed exceptionally well over the festive season, that has continued due to strong demand. Our winter offering has been well received as we drive our ability to read the market better than most. Our ranges are looking stronger than ever, as we see weakness amongst our competitors.
     The rest of the year will be determined by the drop in interest rates which is desperately needed to stimulate the economy. The slow move from the Reserve Bank is incredibly frustrating. There is a direct correlation between high interest rates and consumer demand. As the interest lower and the rand strengthens our well-known brands and our legendary ability to read the trends will place us in a leading position to meet the uptick in demand.
Of course, we are all waiting with bated breath on the GNU and the long overdue promises to stimulate the economy and desperately needed job creation. Without this we will continue to tread water.
The electorate has spoken, it is now time for the GNU to deliver on their election promises. I remain confident it will. Dangee Carken is perfectly placed to confidently and boldly supply when the demand comes through.

Fairly optimistic if politics are stable

Daniel Kurgan, director, Kurgan Kenani Leather
Durban, KZN, SA – At the moment we have enough orders to work 5 days a week until the middle of February. Then I’m not sure. Most of our business is replenishment of some basic items for a couple of chains.
As an industry, we can’t make the variety, the newness, that the chains can get from China. That’s our challenge. It’s not only sneakers. Currently, footbed sandals are a very popular item for the chains, but nobody here makes the composite unit and footbed.

As an industry, we lack the variety

Mohamed Vanker, proprietor, Tego Shoes
Cape Town, W. Cape, SA – We started the year with a reasonable order level from our traditional customer base. We’re fairly satisfied and cautiously optimistic that 2025 will bring us sales growth, and that as long as there are no major political disruptions, that we should be able to build on to all the good work we have put into our company post-Covid.

Closure

Shoetech: ‘Not viable to stay open’

Pinetown, KZN, SA – Machinery supplier Shoetech Engineering cc has closed. Member Eckhard Schumann said he expected the process to be finalised by the end of this month.
     “It’s not viable to try to keep the business open,” he said.
     He said new distributors for Shoetech’s principals hadn’t been settled.
     He plans to retire.

Financial results: Mr Price Group 3rd quarter report

Apparel sales grow almost 11%

Durban, KZN, SA – For the third quarter from 29 September 2024 to 28 December 2024 of the financial year ending 29 March 2025, Mr Price Group recorded double digit retail sales growth and market share gains at improved GP margins compared to the corresponding period.
Group retail sales increased by 10.6% (2-year CAGR: 10.3%) to R14.6bn against a firm sales growth base of 9.9%. Market share gains of 60bps, per the Retailers’ Liaison Committee (RLC), were supported by comparable store sales growth of 6.3%. During the Period the group outperformed the total comparable market’s retail sales growth of 6.4% (as per RLC), gaining market share in each month and has now gained share for six consecutive quarters.
     The group previously reported in its interim results outlook (21 November 2024) that its performance into Q3 had gained momentum against an improving consumer backdrop. Retail sales in October increased 11.5%, with resultant market share gains of 70bps. Sales further improved into the first two weeks of November, increasing 14.7%, resulting in sales growth of 12.4% in the combined first 7 weeks of Q3.
     It is important to note that the performance in the last two weeks of November was not comparable due to: • Black Friday having occurred in week 4 in 2024 versus week 3 in 2023 • The shift in the retail calendar resulted in part of the Black Friday weekend and Cyber Monday falling into December • Certain paydays and social grant payments were moved into December in 2024 versus November in 2023
     Despite the above movements, the group’s retail sales growth of 5.9% for November outperformed the total comparable market’s growth. The group gained 60bps of market share in the month, including market share gains in the key Black Friday week.
     The group recorded a strong performance in the month of December with retail sales increasing 12.8%, against a sales growth base of 15.5%. Mr Price Apparel and all acquired businesses delivered double digit growth in the month, and the group gained 70bps of market share.
Retail sales for the group’s corporate-owned stores was as follows:

Group retail sales grew 10.6% to R14.6bn and comparable store sales increased 6.3%. South African retail sales grew 10.8% (comparable store sales: 6.4%) to R13.6bn while non-South African corporate owned store sales increased 7.7% to R1.0bn. Total store sales increased 10.6% while online sales increased 10.5%. Online sales contributed 1.8% of total retail sales during the Period, with a strong growth of 21.9% in December.
     The group’s ongoing strong merchandise offer supported the increase of more full-price items being sold and fewer markdowns than the corresponding period, resulting in retail selling price inflation of 5.3%. Total unit sales increased 4.8% to 110.4m.
     The group reached a significant milestone with the opening of its 3000th store during the quarter. In total 78 new stores were opened, and the group closed the period with a store footprint of 3 031. Trading space increased 4.9% on a weighted average basis.
     Cash sales grew by 11.1%, increasing the contribution to total retail sales to 90.9%. Credit sales increased 5.7% as the group’s account approval framework continued to be implemented with caution. This was against a backdrop of consumer credit applications reaching an all-time high in Q3 2024, while rejection rates remain elevated, according to the National Credit Regulator.
     Retail sales in the Apparel segment grew 10.9% during the quarter (2-year CAGR: 11.3%) and accelerated to 13.2% in December. Comparable store sales for the Period increased 6.5% and unit sales increased 4.8%. Mr Price Apparel continued to gain market share, increasing 80bps, marking six consecutive quarters of gains and Retail sales growth Cont. to retail sales Q3 FY2025 vs FY2024 Apparel segment 10.9% 83.4% Homeware segment 7.9% 13.9% Telecoms segment 16.5% 2.7% Group 10.6% 100.0% the division reached an all-time high market share level in December. Studio 88 grew retail sales by double digits and recorded the highest comparable store sales growth in the segment for both the quarter (7.9%) and the month of December (9.5%). Power Fashion achieved the highest retail sales growth in the segment for the Period and has now gained market share for thirteen consecutive quarters.
     The Homeware segment’s retail sales growth of 7.9% (2-year CAGR: 4.4%) continued to gain momentum, achieving its highest quarterly sales growth of the financial year to date. Comparable store sales increased 5.8% and unit sales increased 4.7%. All homeware divisions grew GP margins and Yuppiechef did so with double-digit sales growth (2-year CAGR: 18.4%) and reached its highest December market share level to date.
     The Telecoms segment continued its high growth performance with retail sales up 16.5% (2-year CAGR: 12.7%), driven by strong performances over Black Friday and the month of December. Comparable store sales increased 5.3%. Further market share gains were achieved, up 10bps according to GfK (November 2024, latest available data).
     The 2025 economic growth outlook for South Africa is anticipated to improve in comparison to 2024. A steadily improving consumer environment, aided by decreasing inflation and lower interest rates, continues to build a solid platform for growth in comparison to recent years.
     However, there are several risk events which could dampen growth forecasts globally. The international political and economic landscapes remain uncertain and could impact inflation and interest rate expectations. Additionally, the positive impact of the Government of National Unity in South Africa and its ability to continue building on its initial success will be closely monitored.
     Despite these external factors, management remain optimistic about the year ahead. The group’s strong merchandise execution, which offers its customers differentiated fashion-value, and its EDLP pricing model makes it well positioned to continue its profitable market share gains.
     Performance in the first three weeks of January is encouraging with double digit retail sales growth and GP margin gains across each of its trading segments. The group is focused on continuing its strong execution in quarter four with plans being well set for the new financial year.

In case you missed it!

The January issue of S&V Footwear & Leather Goods Magazine

CLICK HERE TO VIEW IT ONLINE

S&V Footwear & Leather Goods Magazine Vol91 No1 January 2025

IN THIS ISSUE:

03 Upfront
- What to do about Temu and Shein. Interview with National Chain Retail Federation executive director Michael Lawrence.
- Dodo’s: Addressing structural challenges essential if local retailers are to remain competitive in the long term, writes marketing director Kelli Kupritz.
- Anonymous: Their marketing is overwhelming.
- Bergstan: ‘Platteland’ less affected, says member Stanley Berger.
- Kingsmead: Tax them, don’t ban them, writes COO Ryan Davidson.
- Jumbo Clothing: I’m sure we’re affected, but it’s not huge, says director Alan Scheckter.

15 Headlines with Tinashe Mandirahwe
- Where are we heading as a society? From slip-on shoes to revolutionary shoelace solutions.
- Shein returns to India: The future of workers in India’s footwear and apparel factories is uncertain, as growing competition from Shein’s re-entry into India with lower-priced merchandise intensifies.
- Walmart’s ‘Wirkin Bag’ shakes up luxury fashion. AI-generated images of a Birkin bag show just how iconic and widely recognized its design has become. Even AI knows its distinctive look!.

19 Noticeboard
- Obituary: John Watt, Bata SA veteran who started Bresan Footwear.



Advertisers in this Issue
Arena Trims (14), Berzack Brothers (OFC), Freestyle Genuine Handcrafted Leather (02), FrontierCo/Busby (03), Haesloop Agencies (05), Leather Finishing Products (11), Saddler Belts (07), SAFLEC (08), S&V Calendar (01), S&V Directory (13), Shotland Packaging (16).
 

They Said It

"I started at the Bargaining Council on 23 January 1989 (36 years last Thursday)." - Ashley Pillay, PA to General Secretary/Principal Officer, National Bargaining Council of the Leather Industry of SA.

Got anything you'd like to share?

Do you have any suggestions, comments or experiences about the industry that you'd like to share with the industry? - tony@svmag.co.za

New subscribers last week

Mashaile Daniel Sebiloane, Director, Carnales Communications and Trading, Johannesburg, South Africa
Grant Malherbe, Sourcing, , Truworths, Cape Town, South Africa
Amit Gopal, Director, Gopals Bags & Luggage, Durban, South Africa
Ujjwal, Manager, Milano, Johannesburg, South Africa

Birthdays this week

27/01/1969: Ashraf Saley, Nizam’s Enterprises, Azaadville, Gauteng, SA.
27/01/1985: Mpumi Mazibuko, Leather Zulu, Randburg, Gauteng, SA.
28/01/1944: Martina van Jaarsveld, Martina Shoe Boutique, Brandhof, Free State, SA.
29/01/1973: Nelesh Gulab, Shawney’s Shoes/Walk Tall, Johannesburg, Gauteng, SA.
29/01/1983: Zubairr Sadak, Shoe Talk, Durban, KZN, SA.
30/01/1948: Pravin Mistry, Super Star Fashions, Vereeniging, Gauteng, SA.
31/01/1961: Andy Williams, Agent, Cape Town, W. Cape, SA.
31/01/1971: Ashley Benjamin, NULAW, Durban, KZN, SA.
01/02/1947: Rob Steadman, National Trimmings Specialists, New Germany, KZN, SA.
01/02/1952: Thomas Bredenkamp, Promark, Pretoria, Gauteng, SA.
01/02/19xx: Elaine Smith, the DTI, Pretoria, Gauteng, SA.
01/02/1969: Noeline Kemp, Knots, Bloemfontein, Free State, SA.
02/02/1941: George Geyser, Dancewell, Durban, ZN, SA.
02/02/1946: Chris Schroeder, retired, formerly PMC Group, Pinetown, KZN, SA.
02/02/1965: Rod Oliveira, Rodrigo Shoes, Durban, KZN, SA.
02/02/1972: Muhammad Asif, Unica Group, Pretoria, Gauteng, SA.

In memoriam this week

27/01/2008: Jacob Anagnostakis (b. 03/04/1929), Watson Shoes, Great Brak River, W. Cape, SA.
28/01/2004: David Aaron (b. 12/03/1939), Natal Shoe Components/Natalie Footwear [closed], Durban, KZN, SA.
28/01/1997: Peter O'Brien, Buckman Laboratories, Hammarsdale, KZN, SA.
29/01/1998: Peter Buglass, NPI, Durban, KZN, SA.
30/01/2021: Manie Booysen, former MD of Seton SA, Nigel, Gauteng, SA.
31/01/2016: Rudi Geyser (b. 11/03/1937), EVA Industries, Durban, KZN, SA.
02/02/2018: Sam Foster, retired, formerly Barker Footwear, Cape Town, W. Cape, SA.
02/02/2021: Bernhard Manock (b. 07/07/1933), Manock Naturals, Durban, KZN, SA.

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.

Directory entries updated last week

Bummel Shoes (Pty) Ltd, George, W. Cape, SA.
Jumbo Clothing [Edgray Distributors (Pty) Ltd] East London, E. Cape, SA.
Wookey Fabrics cc, Kimberley, N. Cape, SA.

3. Malawian Kwacha (MWK) (buying)

Source: https://www.rbm.mw/

4. Zambian Kwacha (ZMW) (buying)

Source: https://www.boz.zm/

5. Zimbabwe Gold (ZiG)

Source: Source: https://www.rbz.co.zw/

Note: For previous rates, see HERE

ABSA Agri Trends: Hides & skins prices

Johannesburg, Gauteng, SA (24 January 2024) – The current average hide price increased by 0.13% to R2.798/kg from R2.798/kg a week ago. The current price is 0.35% lower than the average price a month ago and 14.77% lower than the average price a year ago. The range of prices reported was as follows: Minimum price: R2.75 Maximum price: R3.00. Please note: Our methodology weighs the prices we collect according to the number of hides they sell in a month. This is done to make it more representative of the prevailing market price. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies. - Marlene Louw, senior agricultural economist, Nkhensani Mashimbyi, agricultural economist, and Zama Sangweni, agricultural economist, ABSA group.

Note: For previous prices, see HERE

THIS WEEK LAST YEAR!

Back-to-school wrap 2024: Good for the specialists, and hopefully a good start to the year

Death Notice: Sandy Campbell, former component manufacturer

In case you missed it!: The January issue of S&V Footwear & Leather Goods Magazine

READ IT HERE - S&V Weekly Newsletter Vol.10 No.05, January 29 2024

THIS WEEK FIVE YEARS AGO!!

Retail so far this year

Stock Exchange News Service (SENS)
- AVI - Voluntary trading update
- Pepkor - 3-month trading update

Ihlobo in liquidation

SARS: Illicit trade 'is a threat to our people and sovereignty'

READ IT HERE - S&V Weekly Newsletter Vol.6 No.04, January 27, 2020

Contact us

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

Next newsletter: Monday 03 February, 2025. Ad and editorial deadline Friday 31 January.

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