FSCA WARNS CONSUMERS ON BLACK FRIDAY

Be smart and cautious when spending on Black Friday

The Financial Sector Conduct Authority (FSCA) is urging consumers to be smart and cautious on how they spend their hard-earned money on Black Friday.

As a consumer Black Friday should not be about an opportunity to buy luxury items on sale that you can do without, but about purchasing essentials such as food items and clothing at affordable prices. Do not be reckless in purchasing items that you can do without and are not essential to you and your family. Remember many businesses, will use enticing marketing and sales pitches to try and regain some of the losses they experienced over the past two years. Rather spend only on items that you have planned to buy; don’t just spend, plan your spend. Black Friday is every retailer’s opportunity to cover lost ground on low sales during the year due to depressed consumer spending.

It is that time of the year when retailers push for huge sales between November and December on the back of anticipated bonuses and 13th cheques from consumers. According to Statistics SA economic wrap for October 2023, South African consumers continued to cut back on spending in August, with retail trade sales recording its ninth consecutive month of year-on-year decline. However, the Bureau of Market Research (BMR) has predicted a bigger Black Friday period in South Africa than last year despite tepid economic growth.

The new BMR report predicts that Black Friday will add R26.6-billion to the retail sector this year, despite the economic headwinds, the impact of load shedding, decreased consumer spending throughout the year and higher-than-usual inflation. As a consumer Black Friday should not be about an opportunity to buy luxury items on sale that you can do without, but about purchasing essentials such as food items and clothing at affordable prices.  Do not be reckless in purchasing items that you can do without and are not essential to you and your family.

Here are 10 tips to prepare you for the Black Friday sales discount hype:

  1. Prepare early by identifying what you need to buy. Take note of the prices and draw up a list. Compare those prices against the Black Friday sales. In most instances you will find that the price difference is insignificant and minor if at all. Be wary of inflated original prices e.g. “The price of a TV set was R2,999, now only R1999”, when the actual price a few months ago was R1,999.
  2. Having identified the items you would like to purchase, set a budget and stick to it!
  3. Black Friday is not only about purchasing of household items such as food, furniture, and electrical appliances, but there are also companies that offer discounts on repairs and maintenance services for cars, electricity issues and water leaks etc.
  4. If shopping online, be sure to practice online safety by only using reputable online stores that have been used by family or friends successfully in the past. Check the customer reviews and delivery policies.
  5. When making online payments, never give your PIN number or banking details to anyone. Some online stores now accept debit cards and cash on delivery.
  6. Do not walk around with lots of cash on you. Only take the money you need or go with your partner and friend and ask them to keep some of it for you. Keep your cash concealed and never openly count your cash in a public area.
  7. When shopping on store cards such as Woolworths, Edgars, Foschini and Game, be sure that you read the terms and conditions, specifically when it comes to interest charges. Make sure that you can afford the repayments.
  8. Warranties and Returns – Get what you need and make sure that you are happy with your purchase. Some retailers will not refund you if you are not happy with your purchase, they will rather exchange or provide you with a voucher to shop at their store. Some sale items stipulate that there are no returns or refund option available. Take a photo of your receipt in the event that you misplace your receipt and lose out on the warranty.
  9. Avoid borrowing money from illegal/informal lenders (mashonisas) to spend on Black Friday specials. This comes with exceptionally high interest charges and other risks. Rather use formal systems.
  10. Lastly but not the least, do not use money you do not have. Planned shopping with money is better than unplanned shopping and using credit.

South Africans are facing many hardships that make it hard for them to make ends meets. Prioritising your needs over wants and having honest conversations with friends and family on expectations can be ways to lessen the burden in addition to applying the above tips. Remember many businesses, will use enticing marketing and sales pitches to try and regain some of the losses they experienced over the past two years. Rather spend only on items that you have planned to buy; don’t just spend, plan your spend.

The Financial Sector Conduct Authority is the South African financial institutions market conduct regulator and a successor agency to the Financial Services Board (South Africa).

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