- The food and beverages industry in South Africa experienced a 7.4% year-on-year increase in income in March 2023, led by bar sales and food sales with growth rates of 15.6% and 6.8% respectively.
- The industry’s total income in the first quarter of 2023 rose by 12.1% compared to the same period in 2022, primarily driven by growth in restaurants and coffee shops, and takeaway and fast-food outlets.
- Despite the annual and quarterly growth, the seasonally adjusted income for the food and beverages industry decreased by 2.5% in March 2023 compared to February 2023, following a decline of 3.9% in the previous month.
According to recent findings from the South African Statistics (STATSSA) P6420 report, the food and beverages industry in South Africa witnessed a significant growth in income, year on year (YoY), at constant 2019 prices. In March 2023, the industry reported a 7.4% YoY rise compared to the corresponding period in 2022. This notable uptick is attributed to impressive growth rates recorded in bar sales and food sales, which grew by 15.6% and 6.8%, respectively.
In a granular breakdown of the type of income contributing to this growth, the main contributors to the 7.4% YoY increase were restaurants and coffee shops and catering services. These sectors experienced growth rates of 5.1% and 17.0% respectively, each contributing 2.5 percentage points to the overall increase in industry income.
Impressive Growth in Q1 2023
Taking a broader view, the P6420 report reveals that the total income for the food and beverage industry soared by 12.1% in the first quarter (Q1) of 2023 when compared to Q1 2022. This suggests a strong start for the industry in the current year, showcasing resilience amid global economic uncertainties.
The primary drivers of this substantial increase in the first quarter were restaurants and coffee shops and takeaway and fast-food outlets. Restaurants and coffee shops generated growth of 10.9% and contributed 5.3 percentage points to the overall increase, while takeaway and fast-food outlets registered growth of 9.7%, contributing 3.6 percentage points to the total income increase.
Seasonal Adjustments Show a Dip in March 2023
However, on a seasonally adjusted basis, the income for the food and beverages industry saw a decrease of 2.5% in March 2023 compared to February 2023. This suggests a slowdown in industry income from month to month.
This followed a -3.9% month-on-month change in February 2023, indicating a further decrease from the previous month. Despite the YoY growth in Q1, the monthly performance of the industry appears to have experienced some turbulence at the start of 2023, as income increased by 5.4% in January before declining in the subsequent months.
The P6420 report provides a detailed insight into the performance of the food and beverages industry, one of the pillars of South Africa’s domestic economy. Despite the monthly fluctuations in seasonally adjusted income, the strong YoY growth rates and the robust Q1 performance demonstrate the industry’s resilience and potential for continued growth.
It’s clear that despite facing a challenging macroeconomic environment, South Africa’s food and beverages industry continues to thrive, with restaurants and coffee shops and the takeaway and fast-food sector playing a crucial role in driving this growth. The industry’s performance in the coming months will be crucial to monitor as South Africa navigates its economic recovery.
However, it remains to be seen how the sector will fare in the rest of 2023, especially considering the recent month-on-month decreases in seasonally adjusted income. Continued monitoring and analysis of these trends will be crucial to understanding the broader picture of the food and beverages industry’s economic health.
Table 1: Year-on-Year Percentage Change in Income (March 2022 vs March 2023)
|Type of Income||% Change||Contribution to Overall Increase|
|Restaurants & Coffee Shops||5.1%||2.5 percentage points|
|Catering Services||17.0%||2.5 percentage points|
Table 2: Quarter-on-Quarter Change in Income (Q1 2022 vs Q1 2023)
|Type of Enterprise||% Change||Contribution to Overall Increase|
|Restaurants & Coffee Shops||10.9%||5.3 percentage points|
|Takeaway & Fast-Food Outlets||9.7%||3.6 percentage points|
Table 3: Month-on-Month Change in Seasonally Adjusted Income (Jan-Mar 2023)