BankservAfrica’s point of sales and ATM data suggest this year’s Black Friday transaction volume growth in South Africa might be lower than in 2021.
Black Friday takes place on 25 November, and most South African retailers have specials on the day or during the week.
Many other industries, including banks, restaurants, hotels, and telecommunications operators, are also participating in Black Friday.
Black Friday sales have shown strong growth over the last few years, but BankservAfrica predicts that it will slow this year.
BankservAfrica chief business officer Martin Grunewald said Black Friday point-of-sale (POS) and ATM data spend amounted to R3.3 billion. It represented annual growth of 17%.
Black Friday sales volumes totalled 5.2 million in 2021, a 10% improvement from the previous year.
“We may see this year’s Black Friday play out differently as retailers offer promotions in new ways, and unlike previous years where lockdowns had an influence,” Grunewald said.
He said this year’s sales are expected to grow, particularly among consumers seeking a bang for their buck under the mounting economic pressures.
However, there has been a notable acceleration in the erosion of consumers’ purchasing power because of inflation and economic pressure.
A high-level analysis of the BankservAfrica POS and ATM data suggests that growth in transaction volumes might be lower in 2022 than in 2021.
“The volume and value of transactions have been moderating over the past three months, reflecting strain in the economy,” Grunewald said.
The growth in average salaries, measured by the monthly BankservAfrica Take-home Pay Index, has also lagged in nominal and real terms.
Rising interest rates are putting further strain on consumers with debt exposure, which is reflected in sales volumes.
“Yet, with Black Friday recognised as an annual shopping day, positive sales growth is expected,” he said.
One of the reasons for the expected growth is that consumers become more price sensitive in tough economic conditions.
Consumers may choose to take advantage of the Black Friday bargains and stock up for the festive season.
“We could see groceries and necessities topping the list and less demand for durables and more expensive items in light of the difficult economic environment,” economist Elize Kruger said.