Assalamu Alaikum,

Welcome to Issue #14 of MYCOE Retail Matters.

Retail trade sales grew 4.2% year-on-year in May, and two major new shopping developments broke ground this month backed by strong pre-leasing. On the surface, confidence is returning. But underneath, inflation is ticking higher, producer costs have spiked, the Reserve Bank’s next rate call is genuinely too close to call, and August fuel relief has shrunk to a fraction of what was expected only weeks ago. This week, we unpack why the retailers who win from here will not be the fastest to react, they will be the most disciplined, and what that means for how you make decisions, build your supply chain and structure your team.

South Africa’s Reserve Bank meets on 23 July to decide whether to hold the repo rate at 7% or add another 25 basis points to tame inflation that is already climbing. Economists are genuinely split. At the same time, fuel relief that looked certain a month ago has shrunk by more than half, with diesel now at risk of a hike rather than a cut, as conflict in the Middle East pushes oil prices back up.

It would be easy to read this as chaos. It is actually a test of a different leadership skill, the ability to tolerate uncertainty rather than reacting to every data point as it lands.

As I shared on LinkedIn recently, the best leaders are not the ones who respond fastest, they are the ones who separate urgency from importance. A disappointing sales week, a supplier delay or a rate decision does not always require an immediate overhaul. Strong operators gather enough information, challenge their own assumptions and then act with confidence, rather than making emotional decisions simply because they feel pressured to do something.

What this means for retailers:

Do not reprice or re-order stock based on a single month of fuel or inflation data. Wait for the trend, not the headline.

Build a short list of trigger points, such as a second month of fuel increases or a confirmed rate hike, that will actually justify changing your buying or pricing strategy.

Treat this week’s rate decision as one data point in a longer pattern, not a verdict on the year ahead.

CEO Takeaway: The retailers who win the next few months will not be the ones who move first. They will be the ones who know the difference between noise and a real signal.

The headline numbers are genuinely improving. But retailers should read what is driving each number, not just celebrate the direction.

Retail Trade Sales Grow 4.2% Year-on-Year

Retail trade sales rose 4.2% year-on-year in May, Stats SA reported, following a strong revised 5.2% increase in April. Five of seven major retail categories recorded gains.

Retail implication: This is genuine, broad-based growth, not a one-off. Check whether your specific product lines are among the categories driving the gain before you adjust stock levels.

Inflation Set to Climb Again, Producer Costs Spike

May’s inflation reading of 4.5% is expected to move higher again in June, toward roughly 4.7%, while producer price inflation, the cost pressure retailers feel before consumers do, jumped sharply to 7.8% from 4.8% in April.

Retail implication: Consumer inflation is only part of the story. A near-doubling in producer inflation means your suppliers are absorbing real cost increases right now, and some of that will land on your shelf price in the coming months whether or not headline CPI feels dramatic yet.

Interest Rate Decision Too Close to Call

The SARB holds its next Monetary Policy Committee meeting on 23 July. The repo rate has sat at 7% (prime 10.5%) since May, but rising inflation has some economists forecasting a 25 basis point hike to 7.25% (prime 10.75%), while others expect a hold with a hawkish tone.

Retail implication: Do not assume the rate environment is settled. If credit or supplier financing is central to your model, prepare for either outcome rather than budgeting only for a hold.

Fuel Relief Shrinks as Middle East Tensions Rise

Petrol was expected to drop by more than R2 a litre in August. Mid-month data now points to a cut of only around R1 a litre for petrol, with diesel at risk of an increase, as Middle East conflict pushes global oil prices back up.

Retail implication: The disposable income boost many retailers were banking on for the second half of the year is now far less certain. Do not build promotional plans around fuel relief that has not yet been confirmed.

See full outlook:

https://iol.co.za/business/economy/2026-06-25-sp-trims-south-africa-growth-outlook-as-inflation-and-rate-pressures-build/

Fleurhof Mall — Johannesburg

Construction is underway on Fleurhof Mall, a 25,800 square metre shopping centre serving the Fleurhof community just outside Soweto, with completion scheduled for September 2026.

Retail implication: This is a mall being built specifically for an underserved, high-density residential area rather than an established retail node. If you operate near a growth suburb without a major mall yet, watch how quickly anchor tenants move in once one is confirmed, and decide your positioning before they arrive.

Fourways Mall — “The View”, Johannesburg

Construction has started on The View, a R100 million upmarket lifestyle precinct being added to Fourways Mall, South Africa’s largest shopping centre, featuring premium dining and retail space.

Retail implication: Even the biggest, most established malls are reinvesting to stay relevant rather than resting on scale alone. Standing still is not a neutral option in retail property, it is a slow decline relative to competitors who keep upgrading.

GrandWest Mall — Cape Town

A new R650 million, 22,000 square metre retail development is under construction at GrandWest in Cape Town, led by Flanagan & Gerard and Sun International. More than 70% of the space is already let to anchors including Checkers FreshX, SuperSpar, Dis-Chem and Clicks, with opening planned for June 2027.

Retail implication: Major national retailers are willing to commit early and at scale when a development has the right anchor mix and location. That level of pre-leasing confidence is a strong signal about where these groups expect long-term footfall to concentrate.

CEO Takeaway: Whether it is a brand new mall for an underserved suburb, a premium upgrade to an existing giant, or a major new anchor-backed development, capital is still flowing into physical retail. The common thread is precision, developers are targeting exactly who they want to serve, not just adding square metres.

Energy Is Becoming a Strategic Decision, Not Just a Cost

As I posted on LinkedIn recently, margins are being squeezed from every direction, electricity, water, sanitation and refuse, and businesses can either keep raising prices or rethink their cost base. Energy is no longer simply an operational line item, it is becoming a genuine strategic decision for retailers, manufacturers and property owners.

For independent retailers, this means treating your energy and utility spend the same way you treat stock or rent, something to actively manage and renegotiate, not a fixed cost to absorb quietly.

Electric Delivery Fleets Are Coming for Retail Logistics

Retailers today depend heavily on diesel trucks, volatile fuel prices and an increasingly expensive electricity grid. As I shared on LinkedIn, the shift toward electric delivery fleets powered by solar and battery storage promises lower distribution costs, more predictable operating expenses and real resilience against energy disruptions.

For independent and multi-store retailers, the businesses investing in this kind of infrastructure now are not simply cutting costs, they are quietly building a competitive advantage that will matter more as fuel prices keep swinging unpredictably, as we are already seeing this month.

4.2% — Year-on-year growth in South African retail trade sales in May, continuing a multi-month upward trend.

7.8% — Producer price inflation in May, up sharply from 4.8% in April, a leading signal for future consumer prices.

70%+ — Proportion of retail space already let at the new R650 million GrandWest Mall in Cape Town, more than a year before it opens.

A retailer in our network built a genuinely strong business almost entirely around themselves, every pricing call, every supplier relationship and every hiring decision ran through one person. Growth stalled the moment that person’s attention was split across too many things. As I shared on LinkedIn recently, the strongest companies are built to survive their founders, purpose and systems provide continuity when a market shifts or a leader steps back, personality alone does not. The fix for this retailer was not a new strategy, it was documenting decisions, pricing logic and supplier terms so someone else in the business could actually run a normal week without every question landing on the owner’s desk.

OPERATOR INSIGHT: TWO BETS ON WHERE GROWTH COMES FROM

Fourways Mall (Retailer A)

South Africa’s largest shopping centre is investing R100 million in The View, a premium lifestyle precinct designed to keep an already dominant mall relevant and aspirational for years to come.

Fleurhof Mall (Retailer B)

A new 25,800 square metre mall is being built from the ground up to serve a high-density suburb just outside Soweto that has never had a major retail anchor of its own.

Lesson learned: One bet reinvests in scale that already exists, the other creates scale where none existed before. Neither is right or wrong, they are different answers to the same question, where is the growth actually coming from. As I shared on LinkedIn recently, the next phase of retail competition will not be won on who buys better, it will be won on who processes faster, real visibility into stock, movement and margin, and the discipline to act on data rather than instinct, matters more than which growth bet you choose.

How to apply this: Whichever lane you choose, closest and easiest or worth the trip, make sure your systems can actually see what is happening in your business in real time. Growth without visibility just moves the same guesswork to a bigger scale.

RETAIL TECHNOLOGY SPOTLIGHT: REAL-TIME INVENTORY AND ORDER VISIBILITY SYSTEMS

What it is: Software that gives a retailer a single, live view of stock, pricing and orders across every store, warehouse and online channel, instead of relying on separate spreadsheets or end-of-day reports.

Best suited for: Retailers selling across more than one channel or location, where stock and pricing data currently lives in different systems that do not talk to each other.

Cost: Ranges widely depending on the number of channels and locations connected. Many providers offer a phased rollout starting with a single category or store before expanding, which keeps initial investment manageable.

Retail use case: A retailer selling through a physical store, a website and one or two marketplaces can see exactly what is in stock everywhere, adjust pricing centrally and avoid selling stock that has already moved or sold elsewhere.

Expected return: Fewer stockouts and overselling incidents, faster decisions on what to reorder or discount, and less staff time spent reconciling numbers across systems by hand. Weigh this against how much manual reconciliation your team currently does before committing to a platform.

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CLOSING THOUGHT

Discipline is not the same as slowness. It is the ability to keep moving while refusing to overreact to every piece of news that lands in a single week. This applies to a Reserve Bank decision, a fuel price update or a difficult conversation with your team.

The retailers who compound their advantage from here will not be the loudest or the fastest. They will be the ones who built systems that outlast any one decision, any one leader and any one uncertain month.

Wa’alaikum Assalam,

The MYCOE Retail Matters Team

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