Load shedding has pushed South Africans away from perishable foods, and more households are turning to take-aways and easy meals to avoid having groceries go off due to power outages.

This is according to PwC’s latest Global Consumer Insights Survey Pulse, which found that load shedding has also made consumers generally spend less at retail, as funds are diverted elsewhere, leaving many struggling shops high and dry.

Data from Stats SA supports this finding, with May Retail Trade Sales declining by 1.4% year-on-year, marking the sixth consecutive month of a year-on-year decline in retail sales.

This has had an even greater impact on the economy, with investment decisions in the sector affected by diminished business confidence, while negative perceptions have limited foreign investment.

Anton Hugo from PwC Africa Retail Industry said that retailers have been hit particularly hard by this shift, as they have been spending more to support infrastructure.

This added spending could possibly affect their ability to service debt and seek growth opportunities, he said, while the added diesel and other load-shedding-related costs cannot be easily passed onto or recovered from consumers, who are already facing their own economic troubles.

Load shedding impact

Outside of diverting households’ finite spending power, load shedding has also changed how South Africans shop.

PwC’s South African Retail Sentiment Index showed that some of the main reasons driving the negative sentiment among South Africans towards retail were tied to extensive power outages – including poor food quality, stock unavailability and expired produce.

These are all notable consequences of load shedding on the retail supply chain, where retailers have previously highlighted the knock-on effects on refrigeration and logistics networks.

Load shedding also changed consumer behaviour in several other ways – like pushing consumers to prefer non-perishable goods, as these are less reliant on electricity supply.

In turn, the demand for takeaways and food that can be conveniently bought also saw a major jump, PwC said.

Online push

Online purchases also increased dramatically, with 31% of respondents, mainly younger generations who lacked access to alternative energy solutions, choosing to buy more items online.

PwC also said that Gen Zs use search engines, social media and retailer websites to make more informed purchases.

“We have seen that smartphones are playing a crucial role in facilitating smart shopping and enhancing the ‘phygital’ shopping experience, which involves a seamless blend of digital and physical shopping,” Hugo said.

“This underscores the importance for retailers to enhance their online presence and cater to the needs of this important consumer segment.”

The report said that retailers have successfully shifted their focus to digital space and received overall positive feedback regarding their switch to digital channels.

“This indicates that these services, along with campaigns promoting digital retail offerings, have resonated well with customers,” Suleman Jhavary from PwC South Africa Operations Transformation said.

“That said, consumer sentiment towards digital facilities is still somewhat negative, showing that the overall shopping experience being created by online and delivery services has room for improvement.”

Despite technological enhancements being key to providing a frictionless retail experience, PwC said that customers still value in-store staff support – even those who embrace technology.

In addition, the report said there is a desire for direct purchases in South Africa, with half of consumers having purchased directly from a brand’s website and 40% open to buying directly.

Clothing, accessories and electronics were named as the most popular categories for purchase or consideration.

PwC said that the main reasons consumers purchase directly or would choose to do so included knowing that products are authentic, a greater perception of product choice, and availability.

Spending

Like PwC’s previous pulse, a large number of consumers said that they are planning to reduce their spending across all retail categories except for groceries, with 56% of consumers also saying that they forecast an increase in spending.

“A primary driver to this is the additional financial strain in the form of more expensive credit resulting in less disposable income,” Hugo said.

Moreover, consumers displayed a strong preference for products with sustainable values. Many respondents said that they were willing to pay up to 10% more for products with a lower carbon footprint (49%), that were locally produced (48%), or that were biodegradable (48%).