Retailers and trucking companies are worried that the massive congestion at the Lebombo/Maputo border post and the ongoing container crisis at the Port of Durban could cripple the country’s already ailing economy.
Speaking to The Mercury on Tuesday retail giants assured consumers that there will be no shortage of goods during the festive season as they have planned ahead.
Mary Phadi, from the Trucking Association of South Africa (Tasa) said the massive truck congestion at the Lebombo/Maputo Border post during the festive season was very concerning.
“We are concerned about the safety of our drivers and the situation. We would like both the South African government and the Mozambique government to work together to resolve this situation. We as the Southern African Development Community need to work together with all role-players to address our border post challenges.”
Gavin Kelly, CEO of the Road Freight Association, said there are heavy volumes at the border in addition to normal periods as both vacation traffic (South Africans holidaying in Mozambique) and large numbers of Mozambicans are returning home for the festive period.
“Crossing is taking longer. This situation happens twice a year (Easter and Christmas) when tourists and personal traffic volumes increase dramatically. We are aware that the authorities on both sides (South African Revenue Service, Home Affairs and MRA & Immigration) are doing their best to keep the queues to a minimum.”
Malcolm Hartwell, Norton Rose Fulbright director and master mariner, said breaks or delays in the supply chain have an immediate and negative effect on the economy.
“There is no doubt that the port and terminal congestion at Durban has a very negative effect on the supply chain.
Much of the cargo being handled at Durban is pursuant to regular contracts for the regular supply of machinery, equipment and retail products throughout the year.
“There is however a sharp spike in imports prior to the festive season mainly by those involved in the retail industry. They rely heavily on the spike in sales at Christmas of consumer goods such as clothing, electronics and toys.”
Hartwell added that in anticipation of the demand, wholesalers, traders and retailers would place orders and pay for those orders a few months in advance.
“In certain cases, they would have to finance those purchases. Their entire model depends on the goods arriving in time for the Christmas season. Many of the goods are designed for consumption prior to Christmas such as toys, decorations and Christmas gifts and accordingly, if they do not arrive in time, the retailers are stuck with having to hold them until next year while incurring the finance and lost opportunity costs of doing so or selling at huge discounts after Christmas.”
Hartwell said that from a retailer’s perspective, the congestion is a disaster which will cause them considerable and possibly fatal financial losses.
Retailers said they have planned ahead for the festive season.
Shoprite Group’s supermarket said they are fully stocked and well-prepared for both the festive season and back to school trading periods despite the issues currently experienced at South African ports.
“Extensive planning for peak retail trading periods always commences months in advance to ensure Shoprite, Checkers and Usave supermarkets are well-prepared and have sufficient stock of what our 28 million customers want and need, at the lowest prices.”
Jason McCall, marketing communications manager for Boxer stores said they are not affected by the situation.
“Boxer is not concerned at this stage as the company is not affected by the situation mentioned. We do hope that the situation is resolved for all those concerned and that festive season trading resumes for those who are affected.”
Pick n Pay said that they have no delays that would impact the stock levels for Christmas trade as they plan months in advance for this peak shopping period.
Professor Irrshad Kaseeram, from the University of Zululand’s Economics Department, said most established businesses, especially big ones, would have factored in the notorious delays at harbours and borders and would have made timeous orders.
“It is only the inexperienced businesses that would be in trouble. However, if the delays have ratcheted upward to new levels then even those experienced businesses would be affected. If this is the case then they will suffer costs if perishable or short shelf life goods are involved as well as storage costs for more durable goods.”
The Mercury