Newsletter No.03 3 February 2017
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Pepkor Africa appoints new MD
Garth Napier has been appointed managing director of retail chain Pepkor Africa, reporting to the Pepkor Africa Group MD, Leon Lourens.
Napier officially takes over from Charl Cronje who has moved within the group to become MD of Ackermans. Napier joins Pepkor Africa in February 2017 having been CEO of the Edcon Speciality Division; before that he was CEO of Jet Stores.
Lourens says that the group is delighted to welcome Garth to the Pepkor group: “Garth is a dynamic leader and one who has great vision for – and commitment to – growing our business in Africa.”
Napier sees his new role with Pepkor Africa as one of opportunity: “Everyone knows that Africa is a continent of opportunity and I am very proud to be working with a company that knows the retail landscape and how to best harness that opportunity.”
Pepkor Africa – through the PEP store brand (and Power Sales in Zimbabwe) – will be in charge of a growing store network of 300 stores and a staff of 3,300.
Kenya cheers US withdrawal from TPP
The Kenyan ministry of trade has welcomed the US announcement of withdrawal from the Trans-Pacific Partnership (TPP) Agreement, as its duty free exports of textiles to the US, under the Africa Growth Opportunity Act (AGOA), would have hit Kenya bitterly. Under TPP, 12 other countries would have been eligible to export duty free to the US.
Earlier last year, Kenya and other AGOA signatory countries had lobbied to delay implementing TPP, which would have resulted in rivalry for duty free textile exports with 12 Pacific Ocean countries.
“The withdrawal from this trade agreement by Donald Trump is good news for Kenya, particularly the country’ss textile industry,” Kenyan media reported, quoting the ministry of trade principal secretary Chris Kiptoo.
The country’s textile and apparel exports account for about 80 per cent of Kenya’s overall exports under the agreement.
Kenya to allow textile firms in EPZ’s to sell in local market
Kenya is undertaking measures that include allowing textile companies in the Export Promotion Zones (EPZ’s), to sell up to 20 per cent of their production in the domestic market, without paying duties. This policy is being put in place to boost local textile production, by encouraging domestic sales of textiles and meet an increasing local demand.
“We want Kenyan citizens to have access to high quality products that are sold in overseas markets, which is the reason for introducing the policy change” minister of industry, trade and cooperatives Adan Mohamed added during the launch of the progress report on textile and garment sector.
The report informs that the country’s textile and clothing exports have risen to $415 million at the end of 2016.
“Domestic producers are under pressure due to the import of large volumes of second-hand clothing, which however, will reduce once there is a rise in local production,” the minister observed.
H&M targets expansion in SA
While Hennes & Mauritz (H&M) may have delivered an impressive full-year performance in SA amid a constrained consumer environment, the Swedish company’s group results show that global retail is struggling as much as the local sector.
©jewhyte via 123RF
H&M reported South African sales of about R1bn last year from its fewer than 10 stores. In the fourth quarter of its 2016 financial year, H&M local sales grew by 111% in rand terms. H&M opened its doors in SAin 2015.
“We had another fantastic festive season in SA and our customers seem to like what we offer – fashion and quality at the best price in a sustainable way,” said H&M SA communications manager Amelia-May Woudstra. “We currently have nine stores in SA with five in Gauteng and are planning on expanding our offering throughout SA.
“We see a lot of potential in the South African market and have an aggressive expansion strategy in place. We will be opening another two stores in Nelspruit at the Ilanga Mall and in Polokwane at the Mall of the North,” said Woudstra.
For the year ended November 2016, H&M’s group net income fell 11% as a result of increased markdowns during the year and a stronger dollar that made purchasing costs higher. Group sales rose 6%, not unlike the low sales growth figures posted by local retailers.
The world’s second-largest fast-fashion clothing retailer also revealed that it would be scaling back on its global expansion efforts. The prior target was to increase the number of stores by 10%-15% annually.
H&M’s presence extends to 64 markets worldwide, of which 35 have online platforms.
Amsterdam-based retail analyst Ansumana Konneh, with investment group FDA, said H&M’s margins were hurt by the discounts as the company had to clear surplus inventories.
Did you know….
In the 1670s, Louis XIV decreed that only members of the royal court were allowed to wear red heels. It was an easy way to distinguish someone of the upper classes from a commoner.
The Russian military only started wearing socks in 2007. (Before that they’d just wrap pieces of cloth around their feet.)
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