JOHANNESBURG – Retailers reported robust demand following the lifting of the restrictions on alcohol and cigarette sales, but trade on the JSE remained modest.
Shoprite, Africa’s biggest food retailer, rose 1.28 percent to R120.06 a share, rival Spar increased 1.29 percent to R172.70, while Pick n Pay jumped 1.82 percent to R44.22 and Woolworths rose 1.08 percent to R33.61. Only Massmart bucked the trend, falling 1.69 percent to R20.40.
The sales ban had a knock-on impact on retailers, with Massmart estimating in June that missed liquor sales for April and May would be about R2.3 billion based on prior year sales. Massmart said sales had soared following the lifting of the ban.
“We have experienced robust demand for liquor and tobacco products at our stores today,” it said on Tuesday.
Pick n Pay said it recorded strong demand for tobacco and liquor when its stores opened.
“We have worked closely with our suppliers to ensure there is plenty of stock in our stores, and we will replenish stock daily,” said the company.
Tobacco sales had been prohibited since March, while the alcohol ban was relaxed in June, but reintroduced six weeks later on July 12.
The hotel and leisure sector also joined in the frenzy, with Sun International chief operating officer Graham Wood welcoming the easing of the restrictions.
However, Wood said the industry felt the curfew could also have been relaxed further. “However, we are grateful and relieved our restaurants can again serve alcohol. But lifting the onerous ban on alcohol will boost footfall to our properties. With interprovincial travel restrictions lifted, our tourist hotels and resorts, such as Sun City, will be able to reopen on September 2.”
Radisson Blu Hotel Waterfront general manager Clinton Thom said the easing of the restrictions was a great relief to the industry.
Thom said the past few months had been exceptionally tough on the industry. He said business would rebound fully when international borders reopened.
“The job now is to encourage and convince our fellow South Africans, especially those who routinely travel abroad, to instead spend their tourist rands at home,” he said.
Tourism Business Council of South Africa said the industry had developed comprehensive protocols to cope with the expected upswing in demand.
Chief executive Tshifhiwa Tshivhengwa said its members would introduce protocols that would enable travellers and patrons to stay and eat safely in the establishments.
“The idea of being out and about again may seem daunting. However, the protocols ensure a great, uncompromised experience, with appropriate safety processes embedded seamlessly and unobtrusively throughout the journey or visit.”
Nedbank CIB analyst Munira Kharva said the pressures on the restaurant industry were certainly intensifying.
"The recent alcohol ban and curfew of 9pm was a step in the wrong direction for this particular segment.”
Mergence Investment Managers investment analyst Lulama Qongqo said the sector may have to contend with the fact that most people did not have enough disposable income to go to the establishments.
- Additional reporting by Given Majola
BUSINESS REPORT