Frugal shoppers put pressure on retailers

sometimes not even specific to them but just the overall market being softer, then you might see the share price coming off.”

But Sasfin senior analyst Alec Abraham said Pick n Pay’s share price decline was “one day’s price move; I wouldn’t read too much into it. Quite frankly, investors do believe in their turnaround strategy.”

Pick n Pay’s turnaround has focused on stabilising the business, cutting costs and stopping it from losing further market share.

On Friday, the JSE general retailers’ index declined 5.3%, with Pick n Pay closing at R71.69, Shoprite edging up 0.21% to R191.10, and Spar posting a marginal gain of almost 1% to R191.75

What is clear is that consumers do not have money and the pressure is on all retailers.

Typically in times of economic stress, grocery retailers remain the least affected as consumers spend less on discretionary items in order to afford food. But it seems the tide is turning on food retailers as consumer spending remains weak.

Grocery retailers are still doing better than their fashion peers. Mr Price and Edcon are the victims of a weak consumer environment and are continuing to lose market share.

Last month, Mr Price released a trading update reporting a marginal 1% increase in retail sales, sending its shares down 18%.