Widespread looting in two of the most populous provinces in South Africa last week caused significant damage to around 1,000 clothing stores and has impacted sourcing as well as the apparel sector and textile manufacturing.
Days of rioting and looting sparked by the arrest of former President Jacob Zuma spread throughout KwaZulu-Natal and Gauteng, which includes Johannesburg, home to some 27 million people.
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By GlobalDataMore than 800 stores were looted and 100 burnt, in the week 12-16 July, according to the Consumer Goods Council of South Africa (CGCSA). More than 200 entire shopping centres were looted and destroyed. Damage to the overall retail sector is estimated at South African Rand ZAR5 billion (USD340 million), the CGCSA told Just Style.
“Everyone is frantically running numbers. We know about 1,000 closing stores were hit, from stores in shopping centres to street stores,” said Michael J Lawrence, executive director of the National Clothing Retail Federation of South Africa, to Just Style.
The Mr Price Group, one of the country’s largest clothing and home décor retailers, which includes Mr Price, Mr Price Sport, Miladys, Sheet Street and Power Fashion, with 1,592 stores nationwide, had 109 stores, or 7%, “entirely looted,” the Durban-based company said. It has temporarily closed 539 stores.
Lawrence said the immediate concern was the security of distribution centres. Hammarsdale, a logistics, manufacturing and storage hub near the port city of Durban on the country’s main motorway, the N3, that runs to Johannesburg, was also targeted by looters. “Hammarsdale is a deep concern, as there is still civil unrest. We are worried about the security of distribution centres,” said Lawrence.
The deployment of the South African National Defence Force following the unrest has largely restored supply lines, but Lawrence said it was still a challenge. “There is a bit of a battle to get products out there,” he said.
Garment and textile imports have been impacted by the temporary closure of the Durban and Richards Bay ports, the primary import hubs for KwaZulu-Natal and Gauteng. “It is an issue given how time sensitive the clothing season is,” said Lawrence.
While larger retailers are expected to be able to recoup losses from insurance claims, it is smaller and medium-sized stores that will struggle to bridge the financial losses, added Lawrence.
There have been few reports on damage or attacks on garment manufacturers in Durban. One manufacturer, speaking on the condition of anonymity, said the business had been struggling before the Covid-19 pandemic, and was heavily impacted last year. The factory has been closed for the past two weeks. “It has been a struggle to get employees into work, and to ensure their safety,” he said.
Fabric factories have however been hit, such as in the manufacturing hub of Newcastle in KwaZulu-Natal and other parts of the province. “KwaZulu-Natal has quite a big manufacturing community. There are reports of losses at fabric factories with some completely decimated,” said Lawrence.
The looting is expected to cause major job losses, further impacting an economy struggling with the fallout from the Covid-19 pandemic and its highest unemployment rate, at 32.6%, since 2008.
“By the time consumers can access stores, what will have happened to household income? We don’t know what will happen when trading conditions normalise,” said Lawrence.
Click here for more information on the South Africa apparel sector.
