by Theo Boshoff

Shopping trends revealed

What December 2012 meant for many South Africans

December shopping tended to be focused more on general groceries and petrol
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With no more cash in their hands than they had in 2011 – and struggling to keep up with electricity increases as well – consumers bought extra food, furniture and clothes for the family rather than spending money on luxury holidays.

This is the picture emerging when using statistics provided by BankservAfrica to access consumer card spending data, giving valuable insight into how South Africans spent their 2012 festive season.

“It seems consumers in general were very careful, since December 2012 showed one of the slowest increases in card transactions in the last few years,” explains Brad Gillis, chief executive for regulated products at BankservAfrica.

“The average value of all card transactions was only 5.6% higher than a year ago – which is just about what inflation is at the moment. 

Chief economist for economists.co.za Mike Schüssler agrees and explains that retail sales, the travel industry and service stations are unlikely to show strong growth in December 2012 in relation to December 2011. He goes on further to explain that since September 2012, the average card transactions in South Africa have declined from a rate of increase of 7.2% to 5.6% on a year-on-year basis.

“South African consumers are certainly a bit more under pressure than before, as this is the lowest increase in average card values for a December holiday period since 2009,” says Schüssler. 

The data generally indicates consumers mainly spent at supermarkets and service stations, followed by department stores and, surprisingly, restaurants.

“It also shows that only about a quarter of all spending done on credit cards can be considered luxury spending – especially if the types of stores, where the spending took place, are considered,” Schüssler explains.


Where South Africans spent their money over December

By far the largest number of card transactions (over 18 million) took place in general grocery stores and supermarkets. This was followed by 10.6 million of credit card transactions at petrol stations and their convenience stores. These two categories represented about a third of all known card transactions for the month of December.

Surprisingly, fast food restaurants had only about 1.9 million transactions – about a million less than sit-down restaurants and department stores. According to Schüssler, this possibly reflects the fact that many transactions in this category are cash-based.

Fast food restaurants had fewer credit card transactions than family clothing stores, convenience stores and liquor stores. The least number of transactions took place in the travelling industry (including flights) and furniture stores.

“However, both these categories had the highest average transaction value, which indicates a much higher percentage share of total spending,” says Schüssler.

“For every one travel transaction, there are 13 transactions in a restaurant. For every hairdresser visit, there are 10 visits to either a garage or its convenience store. The figures probably do not fully reveal the importance of fast food restaurants, but in most cases these figures do indeed reveal that petrol stations and supermarkets are the places that South Africans visited most in a consumer sense,” says Schüssler.


The average value of transactions

The number of transactions tells a story, but so does their average value.

According to Gillis, the highest average transaction value was in the flights and travel category, which includes travel agents as well as online flight bookings.

“This was nearly R2 500 per transaction, indicating that holiday travel, along with accommodation, were two of the biggest spending items for consumers. Other big spending items were furniture and vehicle services and repairs.”

These four categories were the only ones where the transaction value was over R1 000 per transaction. The average consumer unit electricity payment was just over R1 220 in the third quarter, indicating that only two types of expenditure had a higher average transaction value than electricity spending.

The next biggest transactions were done in toys and games (including electronics) and department stores (which are probably mainly clothing and accessories). The smallest average transaction value was at fast food restaurants. 


A summary of spending

The total spending via credit cards in December 2012 is estimated to have been over R116 billion. 

It is estimated that about R40 billion of card spending can be considered retail spending, while approximately another R20 billion can be considered travelling, eating out and entertainment spending. More or less R20 billion is car-related (petrol, tolls, service, repairs, parts, etc.).

The rest of the estimated card spending of about R116 billion includes everything from legal and medical fees, to plumbers and dry cleaners.


Contact Gerian Miller for more information: GerianM@bankservafrica.com or telephone (011) 497 4067. 

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