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In today's blog we take a look at the latest wholesale trade sales and what type of wholesalers brings in the most money. We will also take a look at the average value of wholesale trade over time (both unadjusted and adjusted for inflation). One thing is clear, there are two or three wholesale sectors that dominates wholesale trade in South Africa. Read below to find out more.
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Total wholesale trade per type of wholesaler
The pie chart below shows the contribution various wholesaler types makes up of total wholesale trade (from 2004 to July 2017).
As can be seen from the pie chart above, almost 20% of wholesale trade is made up by the wholesale sales of solid, liquid and gaseous fuels and related products. Petrol, diesel, paraffin etc.
The second biggest contributor to wholesale sales is the food, beverages and tobacco wholesalers, with their sales making up roughly 16% of total wholesale trade in South Africa.
The third biggest contributor to wholesale sales in South Africa comes from the machinery, equipment and supplies retailers with their sales contributing just over 12% of total wholesale sales in South Africa.
The second biggest contributor to wholesale sales is the food, beverages and tobacco wholesalers, with their sales making up roughly 16% of total wholesale trade in South Africa.
The third biggest contributor to wholesale sales in South Africa comes from the machinery, equipment and supplies retailers with their sales contributing just over 12% of total wholesale sales in South Africa.
The bar chart below shows the average wholesale trade sales per month per year (both unadjusted/nominal prices and adjusted/real prices). Adjustments to the nominal data is made to remove the effects of inflation in order to determine the underlying growth in wholesale trade sales not caused by price increases.
As can be seen from the graphic, when wholesale trade sales are adjusted for inflation, the growth from 2004 to 2017 is not nearly as strong as it is for the unadjusted values. What this indicates is that a large percentage of wholesale sales growth in Rand terms is due to inflation/price increases and not increased demand for goods.
Growth rates from 2004 to July 2017:
Unadjusted (Nominal): 154.1%
Adjusted (Real): 43.4%
That's equivalent to yearly growth of 11% for the unadjusted data and just 3.1% growth in the inflation adjusted data. So after stripping out the effects of inflation, underlying growth in wholesale trade sales are actually pretty poor at 3.1% a year, compared to growth including inflation of 11%. Just shows that a large chunk of growth in retail sales in current prices (not adjusted for inflation) is actually driven by price increases of goods and services and not by increased demand. And this is inline with SA's economic story, which shows low to no growth over the last number of years.
After inflation is stripped out, the average monthly wholesale sales in 2017 is similar to that of 2013. Basically showing that demand for wholesale goods have not really increased since 2013, and it ties in with South Africa's low/no growth GDP growth figures.
Average wholesale trade sales per month for 2017 is sitting at R155.1billion per month when looking at current prices (prices that includes inflation). When stripping out inflation and expressing 2017 wholesale trade sales in 2004 prices, monthly wholesale trade sales (in 2004 prices) amounts to R87.6billion (and this figure was R61billion in 2004). Thus just R26.5billion increase in underlying trade sales per month over a period of 14years (R1.9billion increase per year). That in the bigger scheme of SA's economy is very small increase. Just showing how though the going is in South Africa's economic environment.
Growth rates from 2004 to July 2017:
Unadjusted (Nominal): 154.1%
Adjusted (Real): 43.4%
That's equivalent to yearly growth of 11% for the unadjusted data and just 3.1% growth in the inflation adjusted data. So after stripping out the effects of inflation, underlying growth in wholesale trade sales are actually pretty poor at 3.1% a year, compared to growth including inflation of 11%. Just shows that a large chunk of growth in retail sales in current prices (not adjusted for inflation) is actually driven by price increases of goods and services and not by increased demand. And this is inline with SA's economic story, which shows low to no growth over the last number of years.
After inflation is stripped out, the average monthly wholesale sales in 2017 is similar to that of 2013. Basically showing that demand for wholesale goods have not really increased since 2013, and it ties in with South Africa's low/no growth GDP growth figures.
Average wholesale trade sales per month for 2017 is sitting at R155.1billion per month when looking at current prices (prices that includes inflation). When stripping out inflation and expressing 2017 wholesale trade sales in 2004 prices, monthly wholesale trade sales (in 2004 prices) amounts to R87.6billion (and this figure was R61billion in 2004). Thus just R26.5billion increase in underlying trade sales per month over a period of 14years (R1.9billion increase per year). That in the bigger scheme of SA's economy is very small increase. Just showing how though the going is in South Africa's economic environment.