Personal Accessories in South Africa

Consumer spending remains under pressure due to economic recession

Consumer confidence remained in a slump in South Africa in 2018 as the country remained under the influence of the prolonged economic recession. Although economic indicators improved over the year as the rand rallied against major global currencies during the first half of the year and GDP growth returned to positive ground, discretionary spending continued to slide due to the rising cost of living and tightened access to credit.

Global fashion trends continue to influence demand for personal accessories

Fashion trends in South Africa tend to follow the prevailing global trends. Local consumers now have instant access to the latest fashion trends from around the world through the broadcast media, the internet and social media and this means that the manufacturers and retailers of personal accessories are under increasing pressure to anticipate and keep up with the latest trends in order to remain competitive.

The competitive environment remains fragmented

The competitive environment in personal accessories remains highly fragmented and the market is characterised by numerous relatively small players which are present in only one category. In addition, with chained retailers, licensed importers and large multinational companies prominent among the market leaders, there are indeed few companies that specialise in personal accessories, with most industry players offering these products as part of considerably wider product portfolios.

Specialist retail channels remain the preferred source of most personal accessories

2018 saw leisure and personal goods specialist retailers maintain its position as the leading retail channel for personal accessories. Bags and luggage specialist retailers and jewellery and watch specialist retailers account for the bulk of sales in the industry as they offer specialist sales advice and a wide variety of high-quality products at reasonable prices.

Negative sales growth expected despite anticipated easing of economic conditions

The South African economy is expected to improve somewhat over the forecast period, with inflation and unemployment expected to fall over the medium-term and GDP growth expected to have returned to positive ground before the end of 2018. However, this is unlikely to result in any major turnaround for the fortunes of the country’s personal accessories market, with negative value growth expected in constant 2018 terms in all categories over the forecast period.

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