Boston, MA -- (SBWIRE) -- 01/29/2014 -- BMI View: South Africa's retail sector is expected to grow steadily over the next few years as its increasingly sophisticated urban population and expanding black middle class continues to spend on nonessential items such as clothing and furnishings. This will result in a strong rise in household spending across all retail subsectors. We are particularly bullish about the future growth prospects for restaurants & hotel spending, as well as education and personal care. However, we expect housing & utilities expenditure to remain by far the highest throughout our forecast period.

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The new South African retail report provides an extensive and comprehensive forecast of various retail indicators including household spending, and headline total spending across each retail subsector, household income and employment forecasts, demographic forecasts, and a detailed breakdown of household and per capita spending across a large number of retail areas including food & drink, healthcare and insurance, consumer electronics, toys, pets, gardens, household goods, and a number of other subsectors.

The South African retail market is less developed than those of some other regional peers, with spaza outlets, which sell household goods from residential premises, still popular. However, in the mass grocery retail (MGR) sector, positive growth is being achieved through franchising and through the purchase by major chains of smaller independents operating in former homelands and rural towns. Shopping centres, meanwhile, continue to spring up, attracting both regional and global retailers.

We forecast that the average net household income will be around US$12,944 in 2013, with almost 46% of all households in the lowest income bracket of $5,000+. However, household income is forecast to grow to US$21,816 by 2018, when a projected 42.2% of households will be in the middle-income bracket of US $10,000+, up from less than 28% in 2013. This represents the key demographic for increased household spending on luxury items beyond necessities such as food, utilities and transport, and will result in a corresponding increase in household spending on health, communications and personal care.

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