Additional Lockdown Levels Loom as the 3rd Wave Begins
- The 3rd wave has officially begun in many provinces with the rest not far behind. COVID-19 case growth has been further bolstered by the slow start of Phase 2 of the vaccine roll out.
- The Reserve Bank has held the repo rate steady to provide some financial relief to cash strapped South Africans as inflation hit its highest rate since the pandemic began (4.4%). However, rate hikes are predicted before the end of the year.
- CPG growth remains muted versus last year’s Panic-buying but is slowly recovering.
– Consumers are still eating at home more than pre-pandemic levels
– No signs of liquor stock-piling are visible yet, however rumours of another lockdown could trigger a spike
– Pantry staples such as commodities, meat and dairy are growing, even off last year’s high base – consumers are still looking for cost effective meal options
– Indulgence categories still form a significant part of purchases. Although declining versus the growth seen last year, when shoppers previously spent money made available due to liquor and restaurant bans on treats
– Medicinal and Vitamin categories spike as consumers prepare for the 3rd wave but Soaps & Sanitizers are not at last year’s levels
– Alcohol sales remain steady in the absence of a liquor ban and appear to be driving high growth in CSDs as shoppers purchase mixers with Spirits
– Volume declines are visible in some food categories and manufacturers can expect this to continue, as the recent high inflation reported is present in Food categories in particular
- Despite these limitations, growth can still be achieved – our recent webinar, “Revenue Growth in an Inflationary Environment” provides manufacturers and retailers with success stories and recommendations to maximize market share through price and promotion opportunities and enabling profitable, science-based decision making.
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