Research: Is South Africa a shopping destination? 1

Our Research posts are about the latest academic research being done in the School of Economics. This week:

IS SOUTH AFRICA A SHOPPING DESTINATION?

By Andrea Saayman & Melville Saayman

When we think of the reasons why foreign visitors visit our shores, wonderful landscapes, wildlife, cultural diversity and sandy beaches immediately springs to mind.  But an important reason for many tourists visiting South Africa is mostly neglected – namely shopping.

Toursit shopping can be as big as the Great Wall

Tourism literature distinguishes between two types of shopping associated with tourism, namely tourism or tourist shopping, and shopping tourism.  Tourism shopping is defined as “the expenditure on goods purchased in a country, by international visitors, either for consumption in the place where it is bought or for export but not including expenditure on food, drink of grocery items”.  It therefore belongs to one of two types, namely a leisure activity or a rational economic transaction, which we often see in duty-free areas, such as airports or ferry-boats.

Shopping tourism, as opposed to tourists’ shopping, means travel to a country with the explicit aim to buy goods that are unavailable or difficult to find in one’s home country. These goods will be bought either for personal consumption or for reselling back home with a considerable profit.  Shopping tourism is one of the manifestations of an informal private economy within developing countries.

In the South African context, African tourists make up the largest percentage of visitors to South Africa.  The African tourism market can further be divided into neighbouring countries versus other African countries, with neighbouring countries making up the largest percentage of African tourists, thereby generating the largest number of visitors to South Africa.  A typical holiday-maker would spend most of his/her budget on typical tourism products, such as accommodation, transport, recreation and food.  However, an analysis of the spending patterns of African tourists show that spending on capital goods and shopping for resale account for more than 60% of total average expenditure, while spending on accommodation and other “typical” tourism products is less than 20% of total spending.

This clearly highlights an important reason for visiting South African – shopping.  In our research we not only classify African tourism markets according as shopping tourism or tourist shopping, but we also investigate the link between African tourism to South Africa and trade.  A number of important implications follow from the research:

Firstly, the fact that South Africa is a shopping tourism destination provides great opportunities for bordering provinces in South Africa to provide the required goods and services in order to benefit fully from this enormous market.  A better understanding of the shopping behaviour of these visitors is a prerequisite for reaping full benefits.

Secondly, it is evident that South Africa is a wholesale destination not only to its neighbours, but also to other countries in the Southern African Development Community.  It is therefore not surprising that there is a closer link between tourism and trade between African countries and South Africa.

Thirdly, in understanding African tourism to South Africa, trade theory that might prove to be more insightful than tourism theory.

The complete article is forthcoming in the December 2012 issue of Tourism Economics.

One comment

  1. Pingback: Nuus / News special report « Skool vir Ekonomie

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