The strong rand, which has gained 46% this year against the dollar, means that a P4 laptop will now sell for R8 500 - down from around R14 000 - and this has led to an increase in sales at Pretoria-based notebook and accessories retailer, The Notebook Company (www.notebook.co.za), with sales increasing by 30% during the first nine months of the year compared to the same period last year.
Christopher Riley, CEO of The Notebook Company, said that although sales were up 30% for the first nine months, actual revenue was only up 10%. "The strong rand is certainly boosting laptop sales across the board, but retailers are not reaping such large profits."
He said that although he is happy with the company`s performance during January to September this year, the strong rand appears to be affecting a number of the company`s clients - especially those "who have built up an infrastructure around exports".
"The strong rand is badly affecting manufacturing and mining. Tourism, too, is under stress. The strong rand might be good for consumers, but there are a lot of businesses that could really suffer. We have to sell more laptops to make the same numbers," he said. But Riley was still bullish about the year ahead for his company, adding that he expects the rand, contrary to some reports, to start losing value again in the near future.
But the buoyant rand is definitely taking its toll on some economic sectors. Tourvest, for example - one of the country`s largest tourism companies - expects headline earnings and headline earnings a share for the six months to December to drop by more than 30% compared to the corresponding period last year. Tourvest has a market capitalisation of R1.1 billion. The tourism industry contributes about 8.5% to SA`s gross domestic product.
Riley said The Notebook Company will "generate close to R20 million" for the year ended February 2004.
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