The excitement around the Billion Group's gamble to build East London's first township shopping mall has fizzled out as sales slow.
The Mdantsane City's development was welcomed by the Buffalo City Municipality and township residents but its opening in April coincided with a major retail downturn.
Store managers interviewed this month spoke of lower than expected sales volumes, while some thought Mdantsane's buying power may have been over-estimated.
Glomail outlet manager Clarisa Jack said although there was a lot of foot traffic through the mall's hallways, business did not meet expectations.
There was hope, however, that things would improve as the Christmas shopping rush picked up, she said.
“People in Mdantsane don't have as much buying power as in Beacon Bay, for instance.
“They don't come here and buy impulsively. If they see something they want they usually go back and plan before they buy.”
Transport problems and crime were other problems highlighted by store managers.
At the official opening, it was hoped the new mall would mean reduced transport costs for township residents who were forced before to go into the city.
Marianne Mark-Graaff, a manager of Amayeza Ethu Pharmacy, said taxi fares had proved to be a problem as many customers usually had to fork out twice to reach the centre.
Most customers first had to travel by taxi to the highway taxi rank, before taking another taxi to the shopping centre.
At least four stores had closed since the centre opened in April, she said.
“It's not a good sign, but we remain hopeful. There is money out there but the biggest problem is transport.”
The four outlets that have closed are Beaver Canoe, Vodacom Chatz, Curry Munchers and Captain do Rego's.
Beaver Canoe general manager Alan Mancer cited poor trading conditions.
Police were unable to confirm reports of crime at the mall.
Customers living far from the centre said they still preferred travelling into East London to do their shopping.
“I don't usually come here,” said Vuyiswa Tyaliti. “I'd rather go to town because transport is cheaper for me that way.
"I live in NU11 and if I take the taxi I pay almost three times more than for the train. Coming here means I have to take two taxis.”
However, those who live close to the centre preferred shopping at the new mall. They either walked or paid R10 for a return trip by taxi.
Shopping centre manager Nobubele Ncube said growth in turnover was “impressive” given the current economic climate.
“Just over the last quarter we have achieved a phenomenal turnover growth (in sales) of 27.65%,” said Ncube.
“This growth is more than double that of the current SA retail growth, mainly due to the fact that it is still a new centre.”
She said the loss of tenants was a normal hiccup.
The mall's occupancy rate was 95%, with vacant space already taken by new tenants moving in early next year, said Ncube.
“These small stores were not trading well, which is normal.
“This happens with all shopping centres until an optimal and correct tenant mix has been achieved.”
Ncube admitted that transport was a challenge for customers.
“The centre is not benefiting from passing traffic yet, which could be generated through the taxi rank being used as a hub for different destinations, not necessarily to Mdantsane City itself.”
Source: Daily Dispatch
Published courtesy of
