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Q3 2017

Fishing’s not for the faint hearted

There are several factors that are having an impact on how well the fishing industry is doing. These range from the changing weather, to the changing economic climate, to the way the world is changing around us. CARIN HARDISTY explored how the industry is impacted by these elements

The Johannesburg SAFTAD* (South African Fishing Tackle Agents and Distributors) fishing tackle trade show is around the corner and the Durban show closed less than a month ago. They are important gathering points on the fishing trade’s calendar as they bring together retailers and distributors in one venue.

Not only does this provide them the opportunity to do business, but here they can also network and socialise with other industry members … and people will inevitably discuss and compare their individual trade experiences and topics affecting their businesses.

Trade shows’ number one reason, though, is to gather as many exhibitors and retailers together in one spot to make selling and buying of products as convenient as possible.

“SAFTAD offers a great opportunity to see multiple customers at one time at a much lower cost than each distributor having to go see each customer in turn,” SAFTAD president John Pledger points out. “The logistics and time required to see each customer individually would make it prohibitive for most exhibitors.”

National trade shows are important to the industry, agrees a tackle supplier wishing to stay anonymous. “Trade shows especially benefit the smaller distributor that wouldn’t necessarily be able to see as many retailers.

“The big players don’t really need to be at SAFTAD,” he adds, “but they pull the visitors, so it benefits all if they exhibit.”

Anonymous, however, also argues that road shows have their place. “It’s often only the owners and buyers who can attend SAFTAD. Regional road shows, on the other hand, give in-store retail salespeople the chance to also see the ranges as the shows are on their doorstep and they can be away from the shop for a shorter period of time.”

Pledger warns, however, that not everyone agrees with these road shows. “In the past, there have been several complaints about the larger distributors doing pre-shows.”

But, retailers can easily spend about four hours at each of the big players’ stands at SAFTAD, argues anonymous. “This could, hypothetically, leave about two hours across the entire show to see the rest of the exhibitors at SAFTAD. If they see these big brands before the show, it leaves more time to see the smaller exhibitors at the show.

“There are now more people trading in the fishing industry, but the industry stays the same size, so the market shares are getting smaller. The smaller guys are more focused and can do relatively better than the big guys,” is the view of anonymous.

No matter how competitive the selling environment, let’s face it — post show hours, when the drinks come out, people tend to forget that they’re competitors, and the talk turns to other mutual concerns. Topics might include the droughts that are causing problems across large parts of the country. After all, fish need water to survive — and without fresh water, freshwater fishing becomes a problem.

Can’t fish without water

A drought is therefore more of an industry problem than a lack of drinking water for humans. In 2015, South Africa experienced the worst drought in more than a century — and several areas haven’t recovered, with strict water restrictions remaining in place.

The Western Cape (suffering from the worst drought in more than a century), Free State, Gauteng, and Northern Cape are all experiencing — or recovering from — drought conditions, with KwaZulu Natal predicting problems if it doesn’t get good rainfall soon.

Droughts can affect the fishing industry in two ways:
  • Rivers and dams dry up, which translates into no fish to catch and fewer areas to fish in.
  • Farmers’ crops are damaged and, as a result of less income to farmers, labourers could lose their jobs and farmers spend less. All businesses dependent on the agriculture segment are therefore adversely affected and business owners have less disposable income with which to pay for leisure goods.

In the Western Cape alone, it’s possible that more than 1 700 seasonal jobs within the agricultural sector could be lost, premier Helen Zille estimated in May. Last year 200 000 tonnes of wheat was lost in winter, and farmers have already sold 30 000 animals that they couldn’t feed anymore, she added.

Freshwater fishermen are also becoming despondent, says anonymous. More and more areas in which they can fish, and the fish they may catch, are being restricted. This makes people think twice about wanting to go fish ing … and buying new equipment.

Recession creates uncertainty

South Africa is in a technical recession, and “people are feeling insecure and are unwilling to spend,” says anonymous. “They are also worried about potentially losing their jobs.”

“As South Africans come to terms with the fact that we are in a recession, the majority are forced to think twice before spending their money,” says Patrick Franck of W.E.T. Sports. “This is especially true of fishing consumers. They still want to go fishing, they still want to get away from the daily stresses, but they are more circumspect about how they spend their hard earned cash.

“As much as they would like to be driving a Mercedes Benz, they can only comfortably afford a Hyundai or Tata. If they can afford the top of the range they will buy that, but more often the consumer is buying down, looking for the best value for money item to help their cash go further. The item may not last as long or have all the same features, but it gets the job done.”

“People now rather buy down, or fix their already-purchased items,” agrees anonymous. But, better quality products, that last longer, sell better, he adds.

W.E.T. Sports has enjoyed excellent growth in its fishing sales in the last few years by concentrating on sourcing good quality products at reasonable prices, says Franck. “We have never been in the top of the range market, so factors like the weaker Rand, higher prices for fuel and the cost of living have increased the demand for products in the mid-price market. We hope to continue to provide products in this market that retailers can sell with confidence.”

With the Rand performing unpredictably against the dollar, prices of imported goods remain high. It’s not only the price of products that are affected: “the cost of taking part in competitions is also increasing because of the increase in the cost of fuel and other expenses to get there,” says anonymous.

It’s not all doom-and-gloom though, reminds Pledger. “The industry is sound, although volumes have been affected by the economy and the severe drought conditions. Sales are down, but not as much as some of the other consumer goods industries.”

He also offers a further silver lining: “over many years the trend has been consistent that when the economy improves, the fishing tackle industry recovers quickly.”

Imports see-saw

So what is happening in the fishing industry? It’s difficult to answer this without the much-needed industry research figures — so I will attempt an analysis based on statistics from the Department of Trade and Industry.

In 2014, fishing imports over all took quite a dip: 32.6% fewer units of fishing tackle were imported at 12.4% less Rand value than in 2013. In 2015 imports recovered: the number of units imported were 45.8% more than in 2014 ... but still 1.7% less than in 2013.

Nenegate in December of 2015, however, ended the currency year at R15.57 to the dollar (2015 started the year at R13.03 to the dollar), which started 2016 off on the wrong foot. By the end of 2016, however, the Rand had recovered to R13.63 to the Dollar.

Last year the fishing tackle units imported were 11.9% less than in 2015, but this is mainly because the third quarter of 2015 was a bumper period in terms of the number of units imported (about 40.6% more than in Q3 2016 and 187% up from 2014’s), which was also the main contributor towards 2015’s recovery over 2014.

In the fourth quarter in 2016, however, 18% more fishing tackle units were imported than in Q4 2015, which hopefully signifies a continuing increase in volume numbers into 2017.

Cheaper smaller items favoured

But, looking closer at the individual fishing tackle categories, it is clear that the growth in import volumes are at the lower end of the market. The number of imported accessories, like lures, are a lot higher than other, more expensive, fishing items such as rods and reels.

Interestingly, despite being much lower priced, accessories also account for the highest Rand value of imports — on average these items account for about 90% in volume of imports and 40% of the Rand value of fishing-related imports. Last year was not much of an exception, with small items like accessories accounting for 89.4% of all fishing tackle units imported and the Rand values at 36.1% of all fishing imports for the year.

Reels account for the second highest Rand values (32.3% of imports) but the third highest in volume (3.6%). The number of imported rods is the second highest fishing related import, last year accounting for 6.5% of all units. Rods also accounted for 24.8% of the imported Rand value. Hooks were 0.5% of the 2016 year’s fishing import volumes, and 6.7% of the value.

On average, between 2010-2016, hooks accounted for 0.8% of volumes and 7.3% of the Rand value of all tackle imports for each year. During this period, rods averaged at 5.9% of volume and 23.7% of Rand value, while reels made up 3.4% of volumes and 29.4% of the value.

Even though there was an overall drop in imported tackle units in 2016, the number of imported rod and reel units went up by 7.4% and 23.8% respectively compared to 2015. The smaller items, hooks and accessories, both had fewer imports (down 28.6% and 13.9% respectively) — and with accessories comprising the bulk of imports, this hit the year’s numbers hard. Having started the year at R13.73 to the dollar, and ending the first half of the year on R13.08, 2017 is so far steady. We shall have to see what the rest of the year does, as four of the six years between 2010-2016 peaked at their worst during the last quarter. Perhaps one should invest in duct tape to keep politicians quiet for a while.

* The Johannesburg leg of the SAFTAD trade show takes place 12-13 August at the UNISA Conference Centre in Ormonde.

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