Mobile phones and IT goods are driving sales of technical consumer goods at retailers.
Research from sales monitoring company GfK reveals the local market for technical consumer goods showed signs of recovery in the last quarter of 2009, which also includes sales of festive season gifts.
The survey monitored a market that was worth R9.5 billion in the last quarter of the year. GfK's research comes on the back of news by computer distributors Pinnacle and Mustek that earnings will be higher for the six months to December.
Sales of technical goods improved 0.8% last year, compared to 2008, while sales in the last quarter were up 2.4% year-on-year. GfK says this upward trend was driven by mobile phones and IT, but consumer electronics and photographic products continued their downward trends in the last quarter.
GfK says the growth in some segments like IT, major domestic appliances and mobile phones seen towards the end of the year could be “the beginning of a revival of the country's retail sector”.
Cees Bruggemans, chief economist at First National Bank, says in his Rex column, that the “recovery seems to be gradually spreading its wings, acquiring depth and momentum as it proceeds”.
Netbooks drive
IT products grew 12.3% and telecommunications products improved by 9%. However, office equipment and consumables declined 3.2%. Photography was down 7.5% and consumer electronics slid 10.6%.
Netbooks were the main driver of growth in the IT sales category, says GfK. The IT segment was worth R800 million in the last trading quarter of 2009, showing growth of 12.3%. Of this, notebooks accounted for 70% of sales, growing at 13%.
The demand for monitors was up by 4% in comparison to the last quarter of 2008. “It is expected that within the PC segment, the trend towards notebooks will continue,” says GfK. Within notebooks, netbooks showed the most growth and monitor sales were off the back of “very attractively priced offers for LCD monitors”.
Telecommunications products, such as fixed-line and mobile phones, grew 9% after a small slump once the SIM card registration Act came into effect. “Consumers seem to manage to obtain all the required information to purchase a handset plus a SIM card,” says GfK.
Slow sales
Consumer electronics, however, declined despite the growing market for LCD televisions. The segment was worth almost R2.7 billion during the last quarter, which was a 4% retraction. Flat panel televisions accounted for half of all sales in the segment.
Office equipment and consumables showed a year-on-year decline of 3.2%, reaching a value of R290 million in the last quarter of 2009. This decline was caused by a 20.7% decrease in turnover with single function printers and a 6% decrease in multifunctional printers, while the sales of inkjet cartridges and laser toners still increased by 3.7%.
Despite a good year in 2008 and a promising start in 2009, the market for photographic products continued its slowdown in the last quarter of 2009, dropping 11.3% year-on-year.
Incredible Connection CEO Dave Miller said earlier this year that netbooks were the top seller, while office furniture and stationery sold badly, as expected.
December was a record month in terms of sales, with year-on-year sales growth of 15%, he noted.
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