Bags and Luggage in South Africa

PROSPECTS

Negative value growth ahead for bags and luggage

The forecast period is set to see bags and luggage in South Africa record negative value growth at constant 2018 prices, a performance which is expected to represent deeper declines than what was seen during the review period. Demand for bags and luggage is being suppressed by rising prices due to high inflation and pressure on disposable incomes.

Aspirational consumers expected to continue demanding high-priced products

Premium and luxury brands are expected to be among the best performers in bags and luggage during the forecast period. This is due to rising demand among the country’s emerging black elite, many of whom are highly aspirational and can afford luxury brands, which are regarded as key status symbols.

Internet retailing expected to emerge strongly in the distribution of bags and luggage

Although internet retailing remained a minor distribution channel for bags and luggage in 2018, online sales are expected to gain serious traction in the category during the forecast period. Indeed, store-based retailers are increasingly investing in user-friendly and mobile friendly websites to showcase their products, while increasing numbers of consumers are using the internet as the first step towards deciding which bags and luggage to purchase.

COMPETITIVE LANDSCAPE

Busby Trading maintains its strong leadership in bags and luggage

Busby Trading remained the leader in bags and luggage in 2017 as the company continued to benefit from strong demand for its extensive portfolio of brands. Busby Trading operates as a retailer as well as a licensed importer and distributor of various leading international brands, including Nike, Travelite, Delsey and Nine West, and this has enabled the company to establish a strong consumer base from several different social and income groups.

Famous brands with international profiles remain dominant in bags and luggage

Well-established international brands remain dominant in the highly-fragmented category of bags and luggage. Names such as Avon, Louis Vuitton and Samsonite have already established strong and loyal consumer bases due to their reputations for high quality and consistent focus on innovation in terms of design and functionality.

Legitimate sales of bags and luggage under pressure from illicit sales of counterfeits

Cheap bags and luggage imported from Asian countries and high-grade counterfeit replicas of leading brands are widely available from open markets and even some variety stores across South Africa. Nevertheless, official crackdowns on the parallel trade in counterfeit items are becoming more regular.

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