When developing or designing a shopping centre, it is not merely a case of “build it and they will come”. With an abundance of centres and retail outlets in the country, and even somewhat of an oversupply in some areas, these centres need to keep up with changes in technology, consumer behaviour and economic trends.
The speakers at the Annual South African Council of Shopping Centres (SACSC) Research Conference, which was held in Sandton on 9 May, updated delegates on the economic outlook for retail in South Africa and Africa, explored influences on consumer behaviour and spoke about where retail is headed in the future.
Kundayi Munzara, director of Sesfikile Capital, warned that, although the economy is doing much better than a year ago, it will still be slow for about 12 to 18 months. Tenant retention in this time will be more important than expansion, and might even necessitate rent reductions. “Let the tenants enjoy the better consumer confidence,” he suggested.
With a more positive political outlook, Justice Malala pointed out that the leadership changes at the end of last year provided a big boost for the economy and consumer confidence. The biggest uncertainty for investors at this stage is the land issue, which is not going away, but he advised that we should “grit our teeth and stick it out”. “Keep calm and carry on . . . shopping,” he concluded his talk.
Dr Martyn Davies, managing director for emerging markets and Africa at Deloitte, explained why South Africa is an underperforming and laggard country. “Manufacturing is vital for lowering inequality in Africa, and we have deindustrialised. We must think beyond resources and agriculture,” he stated.
On a somewhat lighter note, retail analyst John Ryan gave international examples of exciting developments in retail design and technology to create an experience for consumers. He mentioned that although some of these trends still seem unlikely to impact South Africa, it is coming. Retail developers and shop owners should be aware of what is out there and plan for the future. Physical shops still matter, but those with a difference have the edge.
Another key message from Foshizi managing director, Lebo Motshegoa, who gave valuable cultural insights and advice, was to consider and get to know the end-users and address their needs in a way that resonates with them.
“The research results and information that is shared at the event equip us with valuable insights that can directly impact our success in this dynamic industry,” says Nomzamo Radebe, chief executive officer of JHI – part of Cushman & Wakefield Excellerate, the official sponsor of the 2018 SACSC Research Conference.
“At a time when consumer behaviour is becoming increasingly difficult to predict and influence, and technology is developing at a rapid pace, it is imperative that we seek out information that empowers us. To be aware of developing trends and being able to adapt and respond to them proactively, is how we can maintain our competitive edge,” she states.
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Caption main image: SA political commentator and facilitator, Justice Malala, says that the political outlook is very positive, however the issue of land expropriation will remain an uncertainty.