Trading conditions look bleak for the next six months: Survey

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Trading conditions in South Africa are expected to remain more difficult in the next six months.

The trade conditions survey was published by the South African Chamber of Commerce and Industry (SACCI), for the month of April.

The survey shows that the volume of retail trade, merchandise export and the number of new vehicle sales has declined on a year-on-year basis.

According to the survey input costs have risen by 83% causing lower profitability as load shedding and investments in alternative sources of power weighed heavily on businesses.

As a result, small scale manufacturers and private personal services have had to shut their doors owing to load shedding.

The survey indicates only 51% of respondents expect trade activities to improve in the next six months compared to 59% in the previous year.

Sales volumes are expected to decline significantly over the next six months (scope of survey) while new orders come under pressure but input costs will rise at a faster pace.

Given the present unpredictable trade environment, employment in the sector is affected negatively and because the employment sub-index stands at 36 which is below 50 the sector could see further job shedding.