DIY retailers struggle in sputtering economy
In this prolonged economic downturn, even DIY chains are starting to suffer as consumers hold off on spending
SA’s DIY retail stores have mostly been immune to economic downturns. When the going was good, people bought new homes, which they renovated later. In a sputtering economy, many prefer fixing things themselves. Thanks to this kind of all-weather resilience, companies like Cashbuild and Italtile became JSE favourites. But now, even they say this slowdown is the severest in a long time. Over the past year, retailers have had a lot to grumble about, as a rise in the VAT rate, increases in the fuel price and poor wage growth have drained consumers’ wallets. The difficulty was evident in total retail sales growing only 1% for the three months to end-December. For hardware, paint and glass retailers, sales shrank 1.5% for the period, Stats SA data shows. This could clearly be seen in the performance of Massmart’s Massbuild division, which had a rise in sales of 5.9% to R13.72bn but only a paltry 1.8% gain to R749.1m in trading profit in its results for the year to December. At rival Cashb...
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