Wholesale & Retail sectors grew during Covid-19 pandemic

By Ntombi Mhlongo

Despite challenges brought about by the Covid-19 pandemic, revenue for the local wholesale and retail sector grew significantly in the 2021/2022 financial year.

This is according to the Eswatini Company Survey 2022 Report presented by the Central Bank of Eswatini (CBE) in conjunction with the Ministry of Economic Planning and Development. During the survey, the wholesale and retail sectors were divided into car dealerships, supermarkets, and fuel sub-sectors.

Two establishments were surveyed in the car dealership sub-sector with one company sharing volume developments, while both companies reported on revenue developments.

“Only one company provided information on profitability. On volume developments, one company reported growth influenced by the demand for new vehicles, which surged after the relaxation of Covid-19 restrictions,” reads part of the report.

It is highlighted that revenues were on the upside, in line with the increase in the total volume of car sales.

“Combined total revenue for the sub-sector grew by 6.5 per cent, year-on-year, to E323.9 million during the review period. In line with the good performance that was displayed in total revenue, one company reported an increase in profit during the year under review,” the report highlights.

The performance of all companies showed positive growth in total revenue despite the effects of the socio-political unrest that occurred in 2021. The growth, the report highlights, was partly attributable to the disruptions brought about by the unrest which triggered panic buying among customers and resulted in high sales volumes in the period.

“The outlook points towards growth in the medium-term, mainly driven by automation in the sub-sector which will bring about convenience for customers,” it is highlighted.

Meanwhile, the fuel wholesale sub-sector was represented by three companies that participated in the survey. All companies reported data on volume and revenue movements, while the two companies shared data on profitability.

On average, the sub-sector experienced a fall in volumes, which was underpinned by government policy that mandated fuel companies to source fuel within the SACU region, causing occasional run-dries.

This was also compounded by the longer turnaround times which were caused by the socio-political unrests both in South Africa and Eswatini. On a positive note, one company was able to record high volumes amid the socio-political unrest which was a result of higher demand for diesel by commercial customers.