South African fashion retailers can expect more competition with the entry of British fast-fashion chain Topshop into SA later in 2012. As reported in Business Day on 31 July 2012, the rollout of Topshop will begin with the first stand-alone flagship store to be opened in Sandton City by the end of November this year, followed by a second store in Durban before year end. Edgars will also stock Topshop & Topman products in the new year, the report said.

Following on from the 2011 introduction of Zara to the SA clothing market, Topshop will put even more pressure on local retailers to up their game & begin to adopt the internationally successful fast-fashion model of clothing retail. According to Nedgroup Securities analyst Syd Vianello, it is unlikely that Topshop will be the last global fashion player to set up shop in SA. “Zara started it, now comes Topshop. H&M will probably be the next one on the line. Another name that’s been mentioned is New Look”, Mr Vianello said.

The Foschini group (TFG), whose brands include Markham, Exact, Foschini, Donna-Claire, Fashion Express, Luella, Due South & American Swiss among others, has already adopted the change and has seen impressive growth figures as a result. TFG increased its sales for the year ending 31 March 2012 by 17%, outperforming the rest of the industry and gaining significant market share over its competitors. TFG CEO Doug Murray says the supply chain initiatives undertaken by the group assisting in achieving these results by enabling TFG to meet the demand for seasonal fast-fashion merchandise (FMCG Supplier News 31 May 2012).

In order to compete effectively & achieve the shorter lead times required, SA retailers will need to move towards local manufacturing, TFG having already done so with their recent purchase of local manufacturer Prestige Clothing. A new directive from the National Treasury will further enforce this as it issued an instruction on 31 July 2012 ordering all government departments & state-owned enterprises to purchase their clothing, textile, footwear & leather from local  manufacturers (Business Report 1 August 2012).

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