Massmart deal - good, bad or neutral news for the consumer?

[#1]

Is this deal going to benefit us as the consumer or are Massmart going to us Walmarts huge buying power to buy the products without really changing the prices here in SA thereby increasing their bottom line? OR are they going to pass the buying power down to the consumers, in other words can I look forward to finally getting that huge 3D tv I've been eying?

[SimonPB]

why do you want a 3D TV ?? currently the technology sucks ..

[#3]

i was pretty impressed when i took the demo at Dion Wired. I could get used to wathching tv like that. but the question is still will i be able to afford it after the Massmart deal.

[#4]

In 2 years time you'll be the sucker who has the older model where you still need to put on the nerdy glasses to be able to watch 3D. And you paid R30K for it.

[SimonPB]

they got non glasses 3D .. but they still not awesome me thinks .. and viewing angle still an issue ..

[#6]

I was going to buy the 3D TV for the kids in December but read some bad reports on how watching 3D for long periods damages the eyes, especially in younger children. At least it stopped me wasting R20K.

[#7]

Shoe!! this has turned into a tech forum .. Back to the deal , I dont think that Walmart will pass on anything . Its not in their nature . The only reason thay are here is due to huge oppertunities they see in the frontier countries.. i.e. nice fat margins..

[SimonPB]

they have to because their competitors are competing on price .. so they will compete on price as well ..

[#9]

Well Simon, you shouldna be watching with your eyes pressed against the screen. Especially not them Japanese movies you always watch..

[SimonPB]

you mean the magna .. you gotta be close to get the full effect ..

[CHATTYCHAT]

There's another factor which leads me to believe that price benefits will not be given through - in SA not much of a consumer resistance to high prices. Example - I've seen people buying their trolly full of groceries at SPAR during normal business hours, notwithstanding that P'nP is 1 km down the road (assuming P'nP is indeed cheaper). Regarding luxury items, much will depend on suppliers' eagerness to gain market share.

[Whatsup]

Chattychat, not sure I agree with you regarding price competitiveness between Spar and Pick'n Pay, Spar has taken market share from PnP, even look at this site share growth over last 3 years PnP 43,21% and Spar 79,12%. Not everybody can be stupid, consumers are voting with their feet.

[Whatsup]

Wallmart's key strengths is that run an extremely efficient logistics and warehousing operation on a global basis. They drive huge costs out of the supply chain and in turn pass this on to the consumer. Woolworths and Spar are the only local operations with any centralized distribution setup worth mentioning, the other retail groups are fiddling in this space. What Wallmart do well is to access product in the global market and leverage their buying power to secure the very best prices, when Wallmart buy they buy very big. Local suppliers may not even get a look in as they will source from the four corners of this earth. Hence Wallmart will be a significant player in the African market and will drive prices down for the benefit of the consumer through immense stock management and their buying power, others will have to wake up.

[samoa]

And hopefully all businesses are based on profit. Otherwise there must be some dark motive. What's your motive to be on this platform? I suppose accumulating losses?LOL

[CHATTYCHAT]

Thanks, however it depends from what level you are taking these stats. In my mind no businessman will lower a price if there is not consumer resistance - or only if suppliers wish to dump old out of fashion stock, or only if the 'sell by' date is dangerously close. Any consumer wishing to enlarge SPAR market share by purchasing consumer goods at a higher price level than competitors' offer, has no access to the altervative, or is stupid.

[THRESHOLD]

More importantly (for greedy little traders anyway) is teh impact on the other retailers. Wallmart China-discounts everything: white goods, electronics, clothing, footwear, pet products... She also sells everything from caravans to budgies. Her scale is vast and her pricing power matches this. How are our "little" retailers going to deal with this new kid on the block?

[THRESHOLD]

The obvious solution might be to find their own suitor - the like of a Tesco.