Tough times bite hard for building material retailers
Market conditions are the worst yet, says Italtile’s CFO — but the group’s lower-income TopT unit is doing well
Italtile has always impressed with its resilience during tough times. Its fortitude, however, is being put to the test as the group digs in to defend its 45% share of SA’s tile market. "Market conditions are the worst we’ve ever seen them," says Italtile CFO Brandon Wood. Italtile — which serves the market through its Italtile, CTM and TopT brands — faces challenges on multiple fronts. Not least of these is the fact that consumers are shying away from committing to home upgrades and renovations, which account for some 80% of its business. The problem is acute among middle-income consumers. "The segment is under severe financial pressure," says Wood. The situation is not helped by government’s introduction, in September 2015, of affordability regulations enforcing strict lending criteria. Not even well-heeled consumers are committing to home renovations on a large scale. "The top income segments have no confidence in the economy and are reluctant to spend," says Wood. Their level of ...
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