South Africa Consumer Electronics Overview - ICEES 2018 | SOUTH AFRICA'S INTERNATIONAL CONSUMERS ELECTONIC SHOW 2017

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As consumers, Africans are similar to urban consumers anywhere else in the world: they are both brand and quality conscious, they seek out the latest trends but watch their budget, and they want a modern, attractive shopping environment.

But Africa is a complex, nuanced market of 53 countries and more than 2000 dialects. Consumers in the north have very different preferences and needs than those of the sub-Saharan countries.

South Africa is the largest consumer electronics market in Africa and among the top 20 global markets for consumer electronics products. In addition to its large domestic market, South Africa has significance as a hub for the growing Sub-Saharan market. Most global IT players have a presence in South Africa (BMI, 2014).


According to the DTI (2014), the electrotechnical sector accounts for 12.5% of South Africa's gross domestic product (GDP). The country’s consumer electronics spending is expected to grow at a compounded annual average growth rate of 7.3% to reach USD10.6bn by 2018, from USD6.4bn in 2010. The key drivers will include increased broadband and mobile subscriber penetration, faster digital TV migration and falling prices of notebooks and flat screen TV sets as well as government digital divide programmes. In particular 3G mobile service take-up and LED and HD TV set upgrades should be factors providing a boost. Other drivers that will increase South Africa’s spending on consumer products include, youthful demographics, urbanisation, rising incomes and a regional economic boom should all support expansion.

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South Africa’s PDA/Smartphone sales is the largest contributor to South Africa’s consumer electronics sales increasing from USD1.95bn in 2010 to USD12.1bn in 2018, followed by PC sales and domestic mobile handsets (BMI, 2014).

The demand in all product categories will be driven by new releases and technologies. Increased demand for mobility, lower prices and channel expansion will fuel demand for notebook computers, as well as digital lifestyle products such as digital cameras, plasma displays, LCD and plasma TV sets, LCD monitors and mobile handsets.

                       

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The table below highlights strengths and opportunities of South Africa’s electronics industry:

STRENGTHS

OPPORTUNITIES

n  The largest consumer electronics market in Africa, with spending projected to reach USD10.5bn by 2018.

n  A hub to serve growing demand in the sub-Saharan region and a major supplier of electronic products to neighbouring countries.

n  A tech-literate, high-end market that is well informed about latest trends.

n  Youthful demographics, rising incomes and a regional economic boom should all support expansion.

n  Despite the presence of some strong local brands, global brands dominate the market overall.

n  Provincial governments,particularly in Gauteng and Western Cape, often follow an agenda of using computers to tackle fundamental challenges.

n  The premium TV set market will be boosted by subsidies for set-top boxes.

n  Increased demand for mobility,lower prices and channel expansion will fuel demand for notebook computers.

n  Mobile handset sales will be driven by new technologies such as HSDPA and 3G, and new services such as mobile banking and mobile TV.

n  The national and local governments will be important drivers of PC demand.

Most of the companies that manufacture their products locally tend to operate in small, niche areas. Apart from the local list of companies operating in South Africa, there are also a number of international consumer electronics companies operating in South Africa. The nature of their business is mainly distribution.

The key companies are: LG Electronics; Samsung Electronics Co. Ltd, Sony Corporation, Royal Philips Electronics N.V, Panasonic, Hoover and Apple.

South Africa's trade in consumer electronics, from 2003 to 2013                 

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The top 4 imports for consumer electronics from the top 4 import markets for South Africa are listed below:

China

Electric apparatus for line telephony,telegraphy

ZAR 12.8bn

Automatic data processing machines(computers)

ZAR 10.9bn

Electric equipment with heating element,domestic

ZAR 2.1bn

Refrigerators,freezers and heat pumps

ZAR 1.0bn


Vietnam

Electric apparatus for line telephony, telegraphy

ZAR 5bn

Automatic data processing machines(computers)

ZAR 1.2bn

Calculators,cash registers,ticket-machines

ZAR 63.4m

Audio-electronic equipment,except recording devices

ZAR 39m


Germany

Machinery for dish washing,bottle washing,filling

ZAR 1.1bn

Electric apparatus for line telephony,telegraphy

ZAR 1.1bn

Air,vacuum pumps,compressors,ventilating fans

ZAR 719.8m

Audio-electronic equipment,except recording devices

ZAR 272.4m


United States

Electric apparatus for line telephony,telegraphy

ZAR 934.9m

Automatic data processing machines(computers)

ZAR 897.9m

Air,vacuum pumps compressors,ventilating fans

ZAR 427.9m

Radar,radio navigation and remote control apparatus

ZAR 238.8m