Discounters is expected to see further strong value growth in South Africa over the forecast period. South Africa’s income divide is expected to persist during the forecast period due to the major challenges that will need to be overcome to balance the country's social dynamics.
Competition is likely to intensify within the discount format, with Shoprite and Pick ‘n’ Pay unveiling ambitious expansion plans for the forecast period. In that optic, Shoprite aims to double its Usave stores within five years, to reach up to 1,000 outlets by 2029.
Despite digitalised services gaining traction in South Africa since the COVID-19 crisis, operators of discounters remain reluctant to embrace online services, due to various factors such as the limited disposable incomes of the target audience (making internet data prices expensive for most households) and the relatively low margins of the channel due its emphasis on offering consumers competitive pricing. Although the channel is not anticipated to fully embrace digitalised services over the forecast period, the combined effects of the influx of affordable smartphones and lowering social media bundle prices will likely encourage operators to expand promotional campaigns to popular social media platforms such as WhatsApp.
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Understand the latest market trends and future growth opportunities for the Discounters industry in South Africa with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
If you're in the Discounters industry in South Africa, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
Discounters are chained retail outlets typically with a selling space of between 400 and 2,500 square metres. Stores have a primary focus on selling a limited range of foods, beverages, tobacco and non-groceries at budget prices, regularly via private label. Discounters can be classified as hard discounters and soft discounters. Hard discounters, first introduced by Aldi in Germany, are also known as limited-line discounters. Stores are typically 400-900 square metres and stock fewer than 1,000 product lines, largely in packaged groceries. Product range available is predominantly made up of private-label brands. Soft discounters are usually slightly larger than hard discounters, and are also known as extended-range discounters. Stores typically stock 1,000-4,000 product lines. As well as private-label and budget brands, stores commonly carry leading brands at discounted prices. Example brands include Aldi, Lidl, and Dia.
See all of our definitionsThis report originates from Passport, our Discounters research and analysis database.
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