Luyanda Sithole brings Revolt Clothing to SA

This article was placed by Thandy Matlaila  of Aptitude Consulting in Artslink.co.za

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Luyanda Sithole presents Revolt Clothing, following a successful career in LA as a fashion marketing specialist.

Luyanda was the Head of marketing and strategy for the retail consulting group Scaling Retail as well as a Vlogger, bringing that international fashion flair to South Africa through the launch of her own line, Revolt Clothing.

Luyanda was born in the state of Pennsylvania USA to South African parents, Velile and Sipho Sithole. While growing up in South Africa she has always had an interest in fashion and entertainment as a whole and got exposed to her parents’ leading independent and integrated entertainment company (Native Rhythms) at an early age, which explains where that star power comes from.

She attended the National School of the Arts as a dance Major, and then made the very brave plunge to move to Los Angeles to study Fashion Marketing, at The Art Institute of California- Hollywood. After graduating with Honours from College, Luyanda dabbled in the music industry under Tricky Stewart‘s label Red Zone Entertainment. Realizing her passion for being in the fashion industry, Luyanda left the music industry behind, and hit the ground running to pursue her dreams to become a fashion mogul. In her tenure under Red Zone Entertainment she rubbed shoulders with the likes of Destiny Child’s Kelly Rowland, Ciara, Ne-Yo and well known producer The Dream.

After starting her own fashion YouTube Channel SilverWears TV and getting emails to feature up and coming designers, Luyanda realized that her own fashion voice needs to be heard. Luyanda has created her own fast fashion online boutique Revolt Clothing to bridge the gap for South African women and their accessibility to unique global styles. After 6 years in the tough city of Los Angeles, Luyanda packed her bags and moved back to Johannesburg South Africa to become a fashion pioneer.

Revolt Clothing launches on 20 August 2016 at the beautiful boutique hotel, The View which is based in Auckland Park. The launch is a strictly by invite stellar mixer for the most sought after fashion bloggers of Mzansi, few exclusive media houses and some A- listers. Known as the “Bad Ass Entrepreneur” Luyanda is excited about the launch and hopes to make a mark in the retail industry and give young women the global trends they desire while keeping their style authentic to Mzansi.

Revolt’s online store is the It-Girl’s destination. An oasis of a range of patterns and textures, a style location for the modern South African girl who is not afraid to mix and match the androgynous and classic styles. The name “Revolt” matches the personal style of the brand’s CEO Luyanda Sithole who refuses to live by the status quo, and surrounds herself with the rebels of the world.

The collection is a combination of trends and fashion influence from the entertainment capital of the United States of America, LA and the vibrant energetic spirit that is Johannesburg.
Website: www.revoltclothing.net

These Five Trends Are Driving Fashion Retail

This article first appeared in Apparel

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As consumers continue seeking convenience and instant gratification through their mobile devices, retailers are thinking about new ways to use technology, data and analytics to generate customer loyalty.

Synchrony Financial, a premier consumer financial services company with more than 80 years of retail heritage, today released The Synchrony Trend Spotter – The Latest in Retail and Consumer Marketing, industry insights highlighting what today’s consumers value most and how retailers can meet their needs.

To develop these insights, Synchrony Financial tracked existing and emerging trends impacting both the retail and mobile payments space. The results show that consumers are especially interested in:

Content marketing: Over 40 percent of consumers said in a recent survey they like to shop at stores that reflect their values.1 With shoppers’ moral and emotional viewpoints in mind, retailers are tailoring their marketing efforts to convey a lifestyle or experience, rather than just sell a product. People who believe in the brand message can help share excitement for the brand. Social media can also offer marketers the opportunity for free content advertising, which gains traction through sharing by people who believe in the brand message.

Athleisure wear: For many people, casual clothing designed for exercising and (almost) everything else has become the “new denim.” Some athleisure brands have surpassed sales of denim classics, and 80 percent of respondents in a recent survey said they have worn “athleisure” clothing for occasions other than working out.2 Of these, 69 percent said they wear athleisure instead of jeans at least once a week. Many of today’s consumers prefer comfort that allows for both movement and style.

Instant delivery: With apps providing amenities ranging from personal chauffeurs to doorstep delivery, retailers are going beyond free shipping and launching same-day delivery services. Some car services are even partnering with retailers to provide same day delivery of groceries, clothing and other goods. Many customers value convenience and instant gratification, and will pay to get it.

Affordable high-end fashion: To extend their reach, many retailers are fostering partnerships to provide accessibility to high fashion brands. Between mass merchant retail brands offering high fashion lines and low-cost retail brands collaborating with high fashion lines, these items are made available to a wider range of the income scale. Low-cost retailers house high fashion trends to satisfy the affluent customer on a bargain hunt, while high-end brand names offer lower-cost merchandise to attract customers at the big box retailers.

Rented/used apparel:  Consumers surveyed said they have rented clothing, and over one-third (34 percent) said they find the concept of renting appealing.3 Retailers are able to reach a larger audience through this business model by allowing their customers to tap into trends and rent apparel for special events at a fraction of the purchase price. In addition to one-time rentals, there are retail apps that allow owners to trade used clothing or send in items they want to rent out. These companies collect and store items, and handle delivery and dry-cleaning, much like a traditional rental company.

Additionally, consumers state they have used a mobile wallet for their retail purchases. App-based payment solutions, mobile payments and the Internet of Things are resulting in consumers developing different expectations of their shopping experience, moving towards online and app-based payment solutions. These new developments in the payment space are also causing retailers to think about how to best create a seamless experience for consumers.

“With our wealth of shopper insights through multiple partnership channels, Synchrony Financial provides retailers with consumer trends to assist them in tailoring their business models,” said Bart Schaller, chief marketing officer, Synchrony Financial. “The retail industry is constantly evolving and we are focused on providing insights and data to our retail partners to help them deliver great customer experiences that drive loyalty and increase sales.”

Australia’s Cotton On to open Supre stores in Africa

This article was written by By  for fashionmag.com.

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Teen fashion retailer Supre will open 30 stores in South Africa in the upcoming years, as part of its international expansion, according to local media.

Supre, owned by fashion heavyweight Cotton On Group, will open its first store in Cape Town in ­October and another four by early next year, reported the Herald Sun.

Cotton On has operated stores in the African nation since 2011 and Supre general manager Elle Roseby said the group was bridging a clear gap in the market for the budget fashion.

“We feel that we have a great position in the country,” Roseby told Business Daily.

Cotton On Group acquired the struggling Supre in 2013. Since then, the group has worked on expanding its supplier network, introducing new fashion lines, redesigning store layouts and presenting products to shoppers in a more impacting way.

Supre recently redesigned its website and has drastically improved its social media presence, lifting its Instagram following from 30,000 to more than 300,000.

Underperforming stores across Australia and New Zealand have been closed over the past three years.

Some 32 new stores are planned for Australia, 10 for New Zealand and 30 for South Africa, taking its count to 190.

 

Edcon continues to struggle in tough retail environment

This article was written by Colleen Goko for BD Live

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IT HAS been a little more than three months since Edcon’s 2016 financial year calendar came to a close, but the highly indebted retailer has yet to release its results.

The company, which delisted from the JSE in 2007 when private equity group Bain Capital bought it for R25bn, is under no obligation to publicise its financials, but as SA’s largest nonfood retailer, market players are interested. In the third quarter, ended December 2015, Edcon reported a 1.7% decline in sales, and a 17% plunge in trading profit, compared with the year-earlier period. Cash sales rose 4%, while credit sales, which make up just more than 30% of all sales, fell 9.9%.

In the period under review, the retailer also asked its bondholders to accept a deferral in interest payments until the end of the year.

FNB Investment analyst Chantal Marx said this had been done to provide Bain Capital time to explore a number of options including the possible sale of all or some of the business. Edcon’s retail divisions include Edgars, Red Square, Boardmans, Jet and Legit. Edcon is also the owner of CNA.

The retail environment in SA has become extremely competitive, with entries from foreign players. Companies compete on how quickly they can spot trends, and stock shelves accordingly. Edgars has been slow to do this, which has ultimately hurt its bottom line.

Sasfin Wealth equity analyst Alec Abraham said Edgars’s traditional apparel retail model included sourcing from low-cost regions, such as Asia. He said this meant there was a long waiting period between placing an order and receiving the merchandise.

“Trends had to be predicted far in advance, often leading to fashion misses, or by the time the merchandise was in-store, the fashion trend was often over, so the retailer was forced to put the clothes on sale to coax customers by low prices to buy the merchandise in order to clear space for the next season’s merchandise,” said Abraham.

He said, in general, if a retailer had too many sales, consumers began to believe there was no rush to buy, as a better deal would come along.

 

“(This makes) it harder for retailers to break ranks and increase prices, at the risk that other retailers will not follow, and thus risk losing sales. This entrenched promotional activity is damaging to retail profitability,” he said.

The third-quarter financials were the first set of results released under the leadership of CEO Bernard Brookes, who was formerly the CEO of Australia’s largest department store group, Myer. Announcing the departure of Brookes last year from Myer, chairman Paul McClintock hinted that under Brookes’s leadership, the department store had failed to adapt quickly to its customers’ needs.

“The board and management team have agreed that the transformation work has reached a pivotal point, and it is appropriate for a new CEO to be given the opportunity to own, lead and drive the transformation programme,” said McClintock.

Edcon’s fourth-quarter and full-year results for the period ended March 2016 are unlikely to show a vast improvement, as local consumer confidence remains at 2008-09 global recession lows, while the economy continues to struggle.

Looking ahead, the Reserve Bank is forecast to raise interest rates at its July meeting, which will decrease the amount of money moving in the economy, and reduce disposable income in households. 36One asset management analyst Daniel Issacs said Edcon was a big ship to turn around, and that significant change would take time.

Nico Smuts, also an analyst at the firm, said the company had recently amended the terms on its debt instruments, and may well do so again.

On Wednesday, Edcon announced it had launched a consent solicitation process to obtain up to R1.5bn in bridge financing from banks and bondholders. It asked bondholders of notes due in 2018 and 2019 to amend debt terms to allow for the new bridge financing, which will be in dollars and euros. Bondholders have until 5pm London time on July 8 to reply.

“This has alleviated some of the pressure on Edcon’s cash flows, but its overall level of indebtedness remains high. A more comprehensive restructuring may be required to stabilise the ship,” Smuts said.

Following the release of Edcon’s third-quarter results, Brookes said the retailer would be adopting a new operating model that included simplifying the business, becoming more customer-centric and retrenching staff in a bid to reduce costs. Edcon had not responded to questions from Business Day at the time of publication.

R500 000 Gert-Johan Coetzee fashion bursaries up for grabs

This article originally appeared in Times Live

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Celebrity designer Gert-Johan Coetzee has dressed A-list personalities including the likes of Kourtney Kardashian and Kelly Rowland. In between creating designer frocks, Gert is on the hunt for two new students to benefit from his bursary programme.

Gert challenged other businesses to invest in education and luxury boutique Luminance has come forward, adding a third bursary to the programme.

This article originally appeared in Times Live

“It’s so hard to get your foot in the door and the aim of my bursary programme is to pass on what I have learnt, and to open doors for youngsters who have the talent and drive to succeed.”

Applications have just opened for the 2017 GJC Fashion Design bursary and the new GJC Fashion Communications and Buying bursary at the Northwest School of design.

It’s the first time he is adding a Fashion Communications bursary, explaining that it will accommodate students who want to learn the business side of the fashion industry. It is this additional bursary that the Luminance Social Responsibility Grant will fund.

“This three-year qualification teaches the business end of fashion – from fashion journalism, marketing and trend forecasting, to buying, event management and online retail aspects,” explains the designer. Both bursaries include mentorship by Coetzee, and the opportunity to intern at his atelier to learn the business from the inside out. The beneficiary of the Luminance Social Responsibility Grant will have a similar opportunity to intern at Luminance.

The three students will receive sewing machines and all their tuition fees and study materials will be covered for the three years of their course.

Last year’s graduate, Prudence Kau, is currently interning full-time at his atelier.

For more information on how to apply for the Gert-Johan Coetzee bursaries and the Luminance Social Responsibility Grant, visit www.nwsd.co.za

This article originally appeared in Times Live

Shock jocks: It’s frock ‘n’ roll time, guys

By Mary Corrigall for Times Live

Balmy weather is still a far-off dream in rain-swept Cape Town but it inspires the summer collections for men presented in the city at SA Menswear Week.

Do long beards work with miniskirts and cutoff tops? If there’s a platform to answer this question, it’s this one. SAMW has become the place where fashion boundaries are pushed.

Perhaps this is the last fashion outpost where anything goes and designers can be daring. After all it’s all been done before in women’s wear.

Kim Gush, Tsvi Karp and others may send men down the ramp in minis, but the recurring question swirling around the week is whether South African men are ready to wear dainty frocks – given that conservatives think that even women should not show anything past the knee.

However, some evolved men have taken more of an interest in expressing themselves through their appearance, the way women have done for centuries.

“The focus on grooming products, gadgets, fashion and make-up for men has been growing for at least five years,” says Nicola Cooper, a researcher and trend analyst who specialises in ”glocalisation” at Nicola Cooper & Associates.

”Women are outranking men in the classroom and the office, encouraging men to redefine their ways of operating. As a result, men are reinventing themselves in order to compete,” she says.

Men’s fashion week is unique in that it showcases street-wear design labels such as 2Bop, Sol-Sol and Young & Lazy, rather than high-end or mass retail brands. This allows the audience a glimpse into cutting-edge ideas, intended to act as inspiration for men interested in something a little different to wear. It’s on this platform that ideas can be raised and tested – and they don’t have to be adopted immediately by the masses in order to prove to be viable.

Most of the designers who show their collections at fashion week are new and small – they couldn’t keep up with the demand if men in great numbers opted for minis this summer.

“We open the collection to pre-orders after the showcase, where we offer a custom made-to-measure service to our clientele,” says Jenevieve Lyons, a young designer who is making a name for herself at SAMW.

“The local menswear market is growing,” says Lyons.

”With growth, innovation comes about, allowing for a larger market and more men accepting fashion-forward apparel.”

Her all-denim summer collection references worker’s clothing, migration and questions African identity.

“Living at a time of digital regurgitation; what we know as reality and normality has long gone,” says Lyons.

Advantages of Africa as an apparel source

By Chris Wynne-Potts for Just Style

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Africa has undeniable advantages that make it attractive as a potential destination for large volume, low cost, commodity garments, according to Chris Wynne-Potts, CEO at African Merchandising Services.

Apparel production constantly shifts. It’s often one of the first manufacturing businesses that go into a developing country, but also the first to leave as the country grows and develops. And with continued margin pressure, companies are constantly looking at new low cost, reliable sources.

Chief procurement officers and buyers also have a challenging balancing act in getting it right. Sourcing strategies differ for every retailer; each company must first define its procurement requirements and factor in the strengths and weaknesses of the various countries and/or regions. Key criteria revolve around cost, quality, CSR (corporate social responsibility), compliance, speed and risk.

In today’s world of heightened security, terrorism, rebel wars, political instability coupled with increasing environmental and human compliance demands, a great deal of thought has to go into a company’s sourcing strategy and spreading the risk.

Africa has many of the ingredients that can make it a global force in apparel and textile exports. However it will take some time for all these ingredients to come together and mirror what China, India, Vietnam and others have done over the last 30 years.

It has cheap, abundant labour; it has water, power, cotton and lots of land. It has receptive governments and attractive investment conditions. But Africa still needs to build much more capacity coupled with vertical operations so that it can convert its raw material into yarn and fabric.

The advantages of Africa

  • Abundant labour. By 2035 sub-Saharan Africa will have the highest working age population (15-64) anywhere in the world – with more than 900m people.
  • Low wages: Kenya US$100 (per month), Lesotho US$90, Tanzania US$90, Madagascar US$65, Ethiopia US$50, Mauritius US$165.
  • AGOA renewed for 10 years until at least 2025. This gives 45 countries in sub-Saharan Africa duty-free access to the US, with the added advantage of being able to use third-country fabric from anywhere. According to Gail Strickler, assistant US trade representative for textiles and apparel, this is a “game changer” and could quadruple its current exports and create another 500,000 jobs.
  • Large adult unemployment coupled with free education and strict labour laws make under-age/child employment unheard of. English is widely spoken in East and Southern Africa.
  • Government backing and promotion of the apparel and textile industries, particularly Kenya, Ethiopia and Lesotho. The sector is seen as being a major employer and reducer of poverty.
  • While the value of current apparel exports is, in global terms, very small, Africa does have a history of garment production and exports. In 2014 Sub-Sahara Africa exported almost US$1bn in apparel value.
  • Lesotho, Ethiopia and Kenya have, or are establishing, training centres and tertiary institutions to promote textile and apparel technical qualifications. Governments today are more and more aware that apparel production offers large-scale employment and creates a sustainable sector – especially when ultimately being able to beneficiate using African grown cotton. Long-term integration, vertical units and textile mills are the end game.
  • Government incentives and tax holidays are offered by many countries to investors.
  • Many US and EU companies are already doing business here, including H&M, Tesco, Primark, VF Corp, PVH, Kohl’s, Wal-Mart, Dillard’s, Dollar General, IFG, Jones Apparel, Haggar, Academy, Belk, Dickies, Children’s Place, Carter’s and Family Dollar.
  • Multiple ports offer weekly sailings to both the US east and west coasts, as well as Europe. Transit times are approximately 30 days to the US east coast, and 20 days to Europe. Various conference and non-conference lines offer regular services in and out of Africa. From the Far East, sailing times vary from 21 days to 30 days to African east coast ports.
  • Export manufacturers are generally big volume producers catering for the large national and international US or EU retailers and brands. They meet the various in-house or third party compliance audits and standards.
  • There is a compelling moral and ethical story that retailers and brands should at least look at some ways to develop business in the poorest continent on the globe.

The challenges facing Africa

Africa is a continent that is rapidly changing, and more so now than ever before. Its growing middle class has created demand in many areas of consumerism, banking, communication, education, transportation and power generation.  Africa also has enormous untapped resources and wealth: huge swathes of fertile agricultural land, abundant minerals, and oil and gas reserves. Power generation and infrastructure is needed, and many projects to address this have already started across the length and breadth of the continent.

Sub-Saharan Africa consists of 48 countries with more than 900m people. Consequently language, cultural diversity, ethnic mix, development, economies, democracy and governance vary across the continent. Africa cannot be looked at as one bloc or country or with one set of eyes in the same way that neither can Europe, Asia or the Americas.

The main countries in Africa with a sizeable and growing apparel manufacturing base are Lesotho, Kenya, Ethiopia and Mauritius, with a second tier consisting of Uganda, Tanzania, Madagascar and Ghana. South Africa has a history of garment production although mainly producing for the domestic market. South Africa’s current issue is that under AGOA its status is deemed as a non-LDC country (Least Developed Country) and therefore has to use local fabric or fabric produced in Africa, resulting in it being less competitive.

Some of the challenges facing Africa are:

  • Current lack of locally produced, competitively priced, export quality fabric. This results in a reliance on imported fabrics, which in turn adds to lead-time on garment deliveries. This is fine for buyers with long lead-times, but probably not for others.
  • Africa grows plenty of cotton but it is almost all exported as the raw material. Local upstream beneficiation and value adding needs to take place. Currently African spinning, knitting, weaving and dyeing represents only about 10% of total African cotton grown. With the 10-year renewal of AGOA it is hoped that textile industries will now evolve and develop as Africa becomes a bigger producer of garments.
  • Improvement in infrastructure along transport routes, port efficiency, government red tape and streamlining export systems need continued work. Power is generally cheap but in some countries the grid is unreliable. Ethiopia has some of the cheapest power in the world and new generation projects will make it a net exporter of power in the next two to three years.
  • The need for a clearly defined government policy on attracting investment, aggressive marketing of this policy in conjunction with potential investors, NGOs and all role players. Simplified barriers to entry for bona-fide investors such as expat visas, work permits, residency rules. Government to continuously address issues around corruption, safety and crime.
  • Government commitment to building regional value chains, regional and continent-wide free trade agreements (Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) etc). Individual country development, marketing and promotion of EPZs (export processing zones ), constructing specialised apparel clusters/zones.
  • Industry authorities and government to streamline the whole value chain including cumbersome customs processes, address the dearth of technical and managerial skills, invest in programmes that increase efficiency of production. Productivity in Africa is not as good as China, Vietnam and many parts of Asia and this has much to do with the longevity of garment making on the continent – but also education and training.
  • What can US and EU buyers source from Africa right now?

    • The main countries that already have critical mass and clusters of export-led manufacturing are Lesotho, Kenya, Ethiopia, Mauritius and, to a slightly smaller extent, Tanzania, Uganda and Madagascar.
    • The vendors are generally geared up for large volumes of commodity type garments. This doesn’t mean just basics, but volume is key.
    • African vendors can supply FOB and generally the fabric is imported. The production is best suited to large programmes where deliveries are constant and lead-time is more generous.
    • The products supplied from Africa in volume are woven shorts and pants, denim jeans, knit tops such as T shirts, polos, henleys, fleece tops, various types of sportswear, gym wear, outdoor wear using all sorts of performance fabrics from the Far East. The key is volume and ideally long-running programmes.
    • In a country like Lesotho, many of the vendors have concentrated on CVS (chief value synthetic) knitted tops and bottoms where the duties are highest and this ends up being a good deal for both the supplier as well as the buyer.
    • Duty-free access into the US under AGOA for ten years at least.

    About the author: African Merchandising Services (AMS) is a specialist apparel buying agent based in South Africa. The two founders have previously set-up and worked for international buying and sourcing companies in Africa, and have many years’ experience sourcing across the continent for large US and EU retailers and brands. With the renewal of AGOA in July 2015 for another ten years, they believe Africa will develop as a new alternative source for apparel buyers – and that AMS is ideally placed for all sourcing, merchandising and quality needs. Click here to contact Chris Wynne-Potts for more information.

Weak rand gives global fashion the edge

written by Colleen GOKO for BDLive

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INTERNATIONAL clothing brands may be getting a foot up against local firms, thanks to the weaker rand.

For homegrown retailers, this is likely to result in lower prices and narrower margins.

About 12 international players are vying for a piece of SA’s R160bn per year market.These include Inditex, the world’s largest clothing retailer through its Zara brand, H&M and Cotton On.

Three years ago, these companies may have had a tough time due to SA’s high import tariffs of as much as 45% duty on foreign goods.

But with the rand trading at some of its weakest levels against major currencies, these brands are now able to compete on price.

Truworths CEO Michael Mark said the competition in the market was heavy — “increasingly so with international retailers entering the market”. In addition, he said, new affordability requirements that require documentary proof before additional credit can be offered, were putting a strain on locals.

Mark said that to remain competitive Truworths would continue to focus on its long-term understanding of the local market and its “DNA”.

SA has more than 23-million square metres in shopping centre space, placing it seventh globally and ahead of countries in Europe. There is another 2-million square metres under construction or planned, according to Urban Studies, a property market research firm.

The construction of more malls comes despite the strain on consumer budgets. Those hurting the most are middle-income consumers who shop at middle-to high-end stores. With the price advantage all but gone, competition has boiled down to differentiation of the brands and what they offer.

The price of clothing at Gap and Cotton On is comparable with that at The Foschini Group, Truworths, Woolworths and Edgars.

Edgars has introduced more than 10 global brands into its stores, which compete with its own products. In an effort to drive foot traffic, SA’s biggest retailer has turned to promotion and sales, but to no gain.

The Woolworths strategy has been to diversify into other markets, most notably Australia through is David Jones acquisition.

Some local firms have been little affected by the arrival of competitors. Mr Price is one of them. Research from Euromonitor International shows Pepkor Retail maintained the leading position in retail in 2015 with an 18% value share.

“Driven by the strong demand for the Pep and Ackermans brands, Pepkor’s position in the channel is based on its expansive distribution network…. Pepkor continues to target low-income and middle-income consumers with its low price strategy,” the report said.

Fashion blogger Janet Pierce said consumers trusted the quality of foreign brands more. “There used to be that trust in local brands but somewhere along the line that changed. If a consumer was going to spend R600 on a shirt at Foschini, they would now rather do it at Zara.”

SA’s clothing industry ‘must seize chances’

Written by Lisa Isaacs for IOL

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Cape Town – With the clothing and textile industry beginning to stabilise after years of turmoil and job losses, local companies have been urged to come together and grow their export footprint.

The 2016 Clothing, Textile and Leather Industry Imbizo, presented by the SA Clothing and Textile Workers Union (Sactwu) yesterday, brought together industry leaders to consider and practically plan how to maximise their exports.

Sactwu general secretary Andre Kriel said the industry was poised for growth.

“The growth won’t come if we sit and relax. Now we have to think about what vision we want to put to the industry. Currently in our industry, there are very minimal exports even though the opportunities are there.

“There is the African Growth and Opportunity Act which the industry hasn’t exploited yet. There is the advantage of the weak currency, but that hasn’t been exploited,” said Kriel.

“Ultimately, the more the industry exports, the more local manufacturing can take place, and that results in job creation in our industry.”

Economic Development Minister Ebrahim Patel called on local manufacturers to collaborate in export efforts.

“To successfully conquer export markets, you’ve got to hunt in packs. You can’t do it as a single company. So, while you are huge competitors in the local market, you’ve got to develop degrees of collaboration to break into the export markets,” he said.

Global retail players in South Africa operate more aggressively, he said. “If you look at our shopping malls today, they are increasingly becoming indistinguishable from retail malls elsewhere in the world.

“South African malls themselves should be showcasing South African fashion. Well-branded local fashion is often absent,” Patel said.

Trade and Industry Minister Rob Davies said the competitiveness of the industry has risen partly as a result of government support programmes.

He said the government had taken measures over the last few years to defend South African borders against the influx of illegal imports flooding the market.

According to Davies, the department had provided R3.5 billion worth of support through the Clothing and Textile Competitiveness Programme, which ensured that 65 000 jobs were kept and 7 000 new ones created.

He said the footwear and leather industry has also been revived, now contributing about R5bn to export earnings, with 20 new factories opened.

Clothing and textile companies have adapted to the “fast fashion” approach, getting a product to retailers faster than imported goods, Davies said.

Bias towards cash sales helps Mr Price survive tough times

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BY COLLEEN GOKO for BDLive

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MR PRICE Group reported a 17.1% increase in full-year earnings, reaping the rewards of its focus on cash sales in an environment that is becoming credit unfriendly.

Mr Price’s low exposure to credit proved to be a boon in the face of weak economic growth and a rising interest rate cycle. Retailers whose sales are credit driven have had to contend with changes in the National Credit Act, that have made it more difficult for lenders to extend credit to new customers.

About 83% of Mr Price’s sales are for cash. The Foschini Group derives just more than half of its sales on credit, while credit sales at Truworths stand at about 60% of total sales.Lentus Asset Management chief investment officer Nic Norman-Smith said the company’s results were solid in what was becoming an increasingly difficult trading environment.

“On the supply side, competition in the retail sector is increasing with the entry of new global competitors.

“At the same time, consumer demand is under pressure, due to the current lacklustre economic environment.”

Norman-Smith said the industry was likely to come under more pressure, as the weaker rand would force retailers to push prices higher.

“Mr Price is clearly faring well and their position in the ‘value’ sector should enable them to benefit from consumers trading down. Whilst the business continues to generate fantastic results, it is going to be difficult for them to justify the current share price rating placed on the stock,” he said.

In the 53 weeks to end April 2, Mr Price, led by CEO Stuart Bird, reported diluted headline earnings per share of 1012.9c, from 865.1c in the year-earlier period.

The group’s cash sales were 9.2% higher, while credit growth rose 2.3%. Total revenue grew 8.4% to R19.6bn, compared with a year ago. The group declared a final gross cash dividend of 419c per share, up 13.7% compared with the year-earlier period.

Cratos Wealth senior analyst Ron Klipin said the results had been within expectations.

“What I find quite interesting is the strength of the apparel line, with the profit up nearly 13% under difficult market conditions. The home division’s operating profit increase of 22% is also a good result.”

In January 2016, the share price was at about R150, but it has since recovered to close at R184.50 on Tuesday.