South African health retailers market led by Clicks

Press Release   •   Jun 20, 2013 12:15 BST

The South African health retailers market increased by 11% in current value terms through 2012, to reach R35.5 billion.

This was significant growth when compared with the previous year, when growth of 8% was recorded. The channel saw higher growth due to an increase in the number of consumers opting to self-medicate, and a general increase in the middle-income population.

Sales within this channel mostly come from consumers within the middle to high LSM groups; hence there was growth in sales as the middle-income population increased.

Health is very important to the South African economy, especially chemists/pharmacies, as consumers are able to easily buy over the counter drugs and medicines which do not require a prescription, and this proved to help many consumers, especially those who cannot afford to get medication from a visit to a private doctor.

Such consumers have been able to save money by avoiding paying the consultation fee if they were to go to a private doctor.
Health retailers are becoming increasingly important in South Africa. Whilst the middle to high LSM groups purchase a number of premium products from beauty specialist retailers, an increasing number of consumers are frequenting"budget"parapharmacies/drugstores such as Clicks and Dis-Chem Pharmacy, as they are one-stop-shopping solutions in terms of health and beauty as Clicks products become more expensive due to the company increasing its prices in line with other retailers, many South Africans are switching to the more affordable Dis-Chem Pharmacy outlets.

The number of outlets increased by 7% in 2012. This growth was almost identical to the increase in selling space in the same year. Health and beauty specialist retailers have been continually working on improving their geographical spread in South Africa to ensure that they improve their shares.

This initiative seems to be yielding results, as can be seen by the increase in value sales. Dis-Chem Pharmacy opened seven more outlets during 2012, which was growth of 11% in outlet numbers compared with the previous year.

Clicks Group led health retailers in 2012, and managed to achieve this by having wider coverage in terms of outlet numbers throughout the country. As such, it is certain that it will remain the biggest player within health and beauty specialist retailers over the forecast period.

For more information on the South African health retailers market, see the latest research: South African Retailers Market

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