Retailer confidence declined from 43% to 36% in the first quarter of 2026. South Africa’s retail sector is entering 2026 on a softer footing after a year of solid consumer spending, with new survey data suggesting the slowdown reflects a shift in household behaviour rather than a collapse in demand. Statistics South Africa data shows retail trade sales rose 3.7% in 2025, underscoring how resilient consumer spending remained despite high borrowing costs.
However, the latest Bureau for Economic Research retail survey shows sentiment in the sector has cooled. In practical terms, that means roughly two-thirds of retailers are dissatisfied with current business conditions, compared with just over half late last year. The bureau said the drop likely reflects a normalisation after a strong 2025 rather than the start of a broad downturn in consumer demand.
What the numbers do show, however, is that spending is becoming increasingly uneven across South African households. One of the clearest signals comes from the vehicle sector. Confidence among new vehicle dealers climbed to 67% in the first quarter of 2026 – the highest level since 2013.
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In effect, about two-thirds of vehicle dealers reported satisfactory business conditions, highlighting strong demand for big-ticket purchases. Furniture retailers were also among the most upbeat segments of the retail sector. These categories tend to rely on higher-income consumers who are able to access credit and continue spending on larger purchases.
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