The local clothing industry is suffering under the weight of imports. Lynda Loxton reports
The slow growth in clothing sales this year has been blamed on the flood of imported clothing which appears to be escaping custom duties. “The extent of imports that escape customs duty is a very worrying element for both retail and the clothing industry,” said Woolworths managing director Sid Muller. “If the authorities do not clamp down on this, it is going to cost a lot of jobs in South Africa.”
Seardel Investment Corporation chairman Aaron Searll recently suggested that the South African Chamber of Business (Sacob) should provide properly trained inspectors to the Department of Customs and Excise to deal with illegal imports.
While Muller agreed that this was a necessary short- term solution, he said he had “difficulty with these initiatives of privately funding government departments. Personally, I think it is wrong because where do you start drawing the line between the operation of a government department … (and) the vested interests of the funder?”
Muller described trading conditions this year as “fairly tough” but said that this had been expected after last year’s “phenomenal” sales.
The Woolworths credit card, which has 800 000 signed- up members nationwide, had proved invaluable in keeping sales ticking over but Muller admitted that his staff had been forced to keep a close watch on credit limits.
Because of tough market conditions, cut-price retailing had blossomed. Sales of food and home furnishings were, however, holding up quite well despite growing pressure on consumer spending power.
There have been problems with the illegal manufacture of “character” merchandise such as clothing bearing Disney and Warner Brothers characters. Muller said although police had raided several of the manufacturers involved and confiscated clothing, this was not being done on an ongoing basis.
Also of concern was the “rapid decline in the shopping environment in CBDs” because of the proliferation of hawkers, Muller said. Woolworths had to close its Hillbrow store “because trading just became impossible.”
Another worry is shoplifting, mainly of clothing owing to its re-sale value. “We are getting it under control by using new technology and closed circuit TV. We are catching thieves at an alarming rate,” Muller said.
Woolworths has embarked on a programme to refurbish its main stores in cities around the country. Food-only stores in Murrayfield and Bryanston and franchises in Brits and Groblersdal will be opened in November.
Outside of South Africa, it is concentrating on stores in the Middle East and Africa. The stores in the Middle East — in Bahrain and Dubai — are proving a challenge as their seasons are different to South Africa’s, Muller said.