Analysis of the Retail Industry in South Africa

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Contents Page

Executive Summary2
1. Introduction3
2. Retail industry in South Africa5
3. Macro and Micro environment analysis6
3.1 Macro environment of Retail market in South Africa6
3.1.1. Political Environment6
3.1.2. Economic environment8
3.1.3 Technological Environment10
3.2 Micro environments analysis11
3.2.1. Suppliers’ Environment11
3.2.2 Consumers’ Environment12
3.2.3 Competitors’ environment15
4. Findings summarization17
5. Conclusion18

Executive Summary

The purpose of the assignment is to develop the written and oral communication skills of marketing for business leadership students. The objective of the assignment is to aware students about the application of market analysis for the retail industry in South Africa. The retail industry effectiveness is dependent on the macro and micro environment analysis of the sector. The students of this group has done the analysis using different resources from South Africa statistics, Standard Bank, and other private consultancy reports that are listed in the reference list. According to the findings, South Africa’s economy is continuing in growth since 1994, which is after the democratic election that resulted from the failure of apartheid. During the regime of Nelson Mandela different improvement in poletical, technological and environmental improvement was done. Improvement in political and technological environment helps the retail industry to develop in size and return that has impact on the overall growth rate in the country more than 4% per year.

1. Introduction

Retailing is a business activity of selling goods and services directly to consumers. Instead of selling products for resale, a retailer sells goods or services to individuals making purchases for themselves or their families. Some retailing businesses sell a combination of goods and services. For example, an automobile dealership that sells automobiles (goods) may also provide automobile repairs (services)( Lewison, 1996). Retailers play an important role in getting products from producers to consumers. Retailers help direct the physical flow of goods and services from places that produce goods to places where goods are used. Since the retailer has direct contact with the users of goods and services, the retailer can discover and attempt to meet the needs and preferences of consumers (Lewison, 1996) The retail marketing system is the basic thing for the business development. There are different factors considered during retail marketing analysis that affect business development of a country. Some include: resource, business offerings, business relationships, policy and trend of retail market. These analyses are broadly categorized in to internal and external retail market analysis. Analysis of macro environment and micro environment is important for knowing the position of retail market. Macro environment analysis includes analysis of technological environment, economic environment, regulatory and political environment. Micro environment analysis includes competitor’s environment, consumers’ environment and supplier’s environment. Besides, it is a proven fact that that written and oral communication skills are necessary for retail market consumer satisfaction and then business success

1.1 Kinds of Retail

As it is cited by Lewison (1996) in the Encarta of 2004, there are many kinds of retailers and they can be categorized according to their store format. Each format has different management and selling techniques for satisfying the needs of a select group of customers. By using different formats, retailers are able to differentiate themselves from their competition. The most common kinds of retailers include specialty stores, department stores, discount stores, retail chain stores, warehouse...
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