Black Friday made its debut in South Africa in 2012 and has now established itself as a major shopping occasion in the retail calendar of the country. This significant occasion continues to be a highlight for shoppers across the nation. Black Friday is coming on the 24th of November 2023. Statistics South Africa has observed that consumers tend to go all out during the Black Friday and the festive season period.

Why Do People Go All Out On Black Friday Spending? 

As one of the most significant shopping events of the year, Black Friday attracts consumers with its abundance of special deals offered by retailers. It is seen as an opportunity for shoppers to stock up on essentials, tick off items from their wish lists, and purchase gifts for the upcoming festive season. During this period, it’s crucial for consumers to weigh how these offers can benefit them, whether it’s by securing a fantastic deal, indulging in a non-essential purchase, or acquiring something they genuinely need.

Despite the current economic challenges and the financial situations of many consumers, they are still gearing up to take advantage of Black Friday as an opportunity to spend. According to TransUnion.co.za, “Despite overall levels of consumer debt remaining high, we’re still anticipating a higher consumption of credit on new facilities compared to existing facilities during the Black Friday period across several credit types.” Prior to making any purchases, it’s advisable for consumers to carefully review their budgets and assess their credit usage. Opting for additional purchases using credit might further complicate their financial situation.

Economic Changes Impacting Consumer Spending

Consumers are continually searching for opportunities to save extra money each month, and major retailers are already preparing and promoting potential savings prospects to attract their attention. However, the year 2023 has presented significant challenges for all South Africans, with rising interest rates and inflation rates directly influencing the cost of goods and services. 

Furthermore, brands are actively seeking ways to capitalise on this situation. In some instances, retailers may prioritise clearing old stock at discounted prices over promoting new inventory. However, consumers should be aware of the price differences. Retailers may, in some cases, increase the price of their products and reduce it again to indicate a savings potential. 

Why Should People Be Cautious When Spending On Black Friday This year? 

With Black Friday occurring towards the end of the month, consumers view it as an ideal time to spend their hard-earned money. Nevertheless, some consumers may depend on various forms of credit to finance their essential or non-essential purchases. For those using their own funds, this could potentially result in a shortfall in their monthly budget. This shortfall could increase their reliance on credit during the festive season and into the new year. 

Consequently, for consumers relying on credit, this could implicate their financial situation, as they now have an additional monthly obligation to manage in the form of a repayment. If you have the affordability, It could be a good idea to prioritise building up a supply of  goods for the new year and consider adding essential items that will last you until the end of January. 

Avoid Using Unnecessary Expensive Credit For Black Friday Purchases 

As the holiday season approaches and there are items that need to be checked off your list, be cautious of offers from credit providers. Take note of the interest if it’s a loan or the charges if it’s a credit card. As a consumer, it is essential to assess whether you will be able to handle another debit order and if you have enough disposable income for non-essential items. 

This year has brought financial difficulties to the country, leaving little to spare. The costs of food, fuel, and necessities have become increasingly burdensome. The repayment plan, combined with interest, could potentially have a detrimental impact on your financial situation. By avoiding the allure and noise of Black Friday, you will be better prepared for the holidays and the challenges of the new year, particularly if you do not have a solid budget.

Here are tips to help you budget wisely and avoid overspending

• Take a moment to review your budget and assess all your balances. Before making any purchases, ask yourself if you truly need the item or if it’s more important to focus on buying essentials. 
• Instead of splurging on a big purchase, consider giving a holiday voucher or get creative with your gift-giving. 
• When shopping online, try adding items to your cart and then carefully review which ones are truly necessary before checking out. 
• It’s also helpful to set financial goals, such as how you plan to save e.g. R2000 to alleviate any stress in January. 
• If you’re struggling with debt, consider exploring the option of debt counselling.

If you are experiencing any financial difficulties, we suggest speaking with a debt counsellor. Vantage has assisted thousands of South Africans with managing their debt. Contact us today so we can provide assistance during this time.