how to … a few essential guidelines to make your life as a...

How to … A few essential guidelines to make your life as a

student easier

Updated: June 2018

ii

© IMM Graduate School of Marketing How to …. A few essential guidelines to make your life as a student easier

Contents

Introduction ............................................................................................................................................ 3

How to plan your study time .................................................................................................................. 3

How to structure and assignment .......................................................................................................... 4

There would be a cover page containing: .............................................................................. 4

Assignment answers............................................................................................................... 5

How to do an in-text citation .................................................................................................................. 8

How to use a model when answering a question ................................................................................. 10

An example of a case study based answer ........................................................................................... 13

How to write a concluding statement .................................................................................................. 17

Checklist before handing in your assignment ....................................................................................... 18

The structure of a good reference list .................................................................................................. 19

Conclusion ............................................................................................................................................. 21

Reference List ........................................................................................................................................ 22

Addendum A: ........................................................................................................................................ 23

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© IMM Graduate School How to … A few essential guidelines to make your life as a student easier

Introduction

This guide provides the most essential guidelines you may need to ensure that you are doing

the basics correctly. This is a simple and pared-down document which is easy to read and

would not demand a lot of your time to work through.

Use this to set you on the road and make sure that you have these basics in place to create a

firm launching pad for your student career. As you gain more experience, you will be able to

develop your own style and approach to doing things, so this guide may come across as very

prescriptive for now, but it’ll help you form the basis from which you can develop your own

style.

Return to this guide as often as you are able to, because we will be adding to it all the time.

How to plan your study time?

Start by identifying the 2 most important dates in your calendar:

1. Assignment Submission Date

2. Examination Date

Work back from there, listing every milestone you would need to achieve in order to be ready

for the deadline dates. Keep in mind that the unforeseen does happen, so make sure that

you allocate more time than you think you will need to cope with all the curve balls life is

bound to throw at you.

Invest in a year planner to put up against your study wall or directly above your desk. Set

days and times out on this planner, remembering to ensure that you have sufficient time

allocated to completing the semester content.

Stick to a pattern: - your brain responds well to a fixed pattern and it’ll be easier to achieve

success. Try and use some of the following guidelines:

work on the same module on the same day each week, i.e. allocate Tuesday to

Business Communication and then always do the work on the module on that day,

work at the same time on the selected day; focus on your Business Communication

every Tuesday from 18h00 to 20h00,

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study in the same place; your brain will associate your selected spot with a certain

type of brain activity, and will be more alert when it sees the learning materials it is

expecting to be exposed to.

How to structure and assignment

You could add a significant mark to your assignment result by simply making sure that your

submission is well structured, and easy for the marker to work through.

The following few pages will give you an idea of what a good assignment structure may look

like in terms of its technical and other requirements.

There would be a cover page containing:

Your initials and surname

Your student number

The title of the assignment – (usually the title of the module with the module code

attached to it)

The date of completion of the assignment

The Index page

Topics

Page numbers

o 1.1 Introduction 1

o 1.2 Increased Spending and Inflation 2

o 1.3 Money in circulation 3

o 1.3.1 Money in use 3

o 1.3.2 4

Student often succumb to the temptation to use fancy scripts and drawings as part of the cover page – stay away from that as this is an academic document

and should, as such, retain a formal air about it.

Are you sure that your font type and size is correct? All assignments must be written in Ariel font size 12.

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Assignment answers

o Question 1

Introduction

1.1. In this answer we are going to look at the reasons why

increases in spending tends to lead to higher levels of inflation in a

national economy (Pugh, 2007).

1.2. Increased Spending and Inflation.

With more cash in the system……

1.3. Money in circulation

This is the result of….

1.4. Money in use

As people buy more, the seller will almost always be prompted

to….

1.3.2

Conclusion

In analysing why increased spending cause inflation, we have

realised that increased spending normally happens on the back

of improved expectations of the future and this state of

euphoria tends to make people more likely to spend more

money on goods and services.

Ensure that all questions are neatly numbered and clearly visible – this makes the task of marking so much easier.

Leave open spaces on pages and do not start answering the next question right away on the same page. This allows the marker to

make notes and to see that you have taken due care in the layout and appearance of your submission.

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o Question 2

2.1. Introduction

The question challenges us to explore the effects of external factors

on the business function and overall success. The commonly

accepted format and framework for doing this type of analysis, is the

application of the PESTLE Framework on the external environment of

the business (Cameron, 2008).

2.2. Political

The political environment influences the levels of business confidence

in several ways. Some of the social and business issues which are

vulnerable to political uncertainty, political changes and shifts in the

political landscape are……….

2.3. Economic

The economy of the country could be described as the functioning of

the business sector in its ….

2.4. Social

Social patterns of behaviour have significant influence on the

business. The social environment influences the behaviour of society,

and this society is likely to react to the change by having different

preferences in the goods they buy, the services they demand and the

entertainment they prefer. We have seen how heightened levels of

awareness of ….

2.5. Technological

According to Jones, (2000), the advances in technology have been

significant in recent lifetimes. Online shopping in the USA is causing

shopping malls to start closing down because the convenience of

shopping from home ….

2.6. Legal

The legal environment has a huge impact on how the business goes

about recruitment and managing its staff. Legal directives in terms of

Check that the answer to every new question starts at the top of a new page.

All answers should be preceded by an

introductory sentence or two

Numbered headings and sub-headings are a core requirement for academic writing. It gives structure and form to your

answer.

Make sure that you have done you’re in-text citation according to the Harvard Referencing Guidelines (see further in this document)

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recyclable packaging, business hours, the disposal of waste, and the

use of natural resources like water………

2.7. Environment

Environmental concerns have led to the outlawing of asbestos as a

building material. Environmental laws could, in the future, dictate….

2.8. Conclusion

Having analysed the external environmental factors and the impact

they have on the successful functioning of a business, we can see

that…….

o Reference List

Cameron, S., (2008) The MBA Handbook, 6th ed., London, Prentice-Hall.

Pugh, D. S., (1973) ‘Does Context Determine Form?’ in Pugh, D. S., ed.,

Organisation

Theory: Selected Classic Readings, 5th ed., London, Penguin books.

A good student will always use a concluding paragraph to put on display the knowledge gained from having answered the question.

The ‘Reference List’ always appears on the final page of the submission. It is not labelled a ‘Bibliography’.

Make sure that you have used the IMM Graduate School’s Harvard Referencing style

for your reference list

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How to do an in-text citation

Students often feel challenged by the technicalities involved in doing correct referencing

according to the Harvard protocol. Here are the most basic ground rules.

Below is an extract from a book about how to improve your chances of survival when

registering for a degree – the book’s title is “The MBA Handbook”, and is was written by Sheila

Cameron in 2008.

First, let us look at the extract as it appears in the book:

The merits of physical exercise will be referred to on a number of occasions in the Handbook.

If you are not already an exercise convert, or doing a physically demanding job, think seriously

about building more exercise into your routine as part of your pre-course preparation. If you

have not developed the habit before your course starts, your chances of doing enough

exercise during your course will be extremely slim. The type of exercise is unimportant

provided it raises a sweat for half an hour or so, and you do it at least two or three times a

week. The effects on your health and your ability to study will be significant.

The IMM Graduate School’s rules about plagiarism dictate that you may not copy sections

from another source word-for-word, even if you do provide a reference for these. If you feel,

however, that a particular piece is so important and was written so well by the author that it

absolutely must appear in your answer, you will insert it as follows:

“The merits of physical exercise will be referred to on a number of occasions in the

Handbook. If you are not already an exercise convert, or doing a physically demanding

job, think seriously about building more exercise into your routine as part of your pre-

course preparation. If you have not developed the habit before your course starts, your

chances of doing enough exercise during your course will be extremely slim. The type

of exercise is unimportant provided it raises a sweat for half an hour or so, and you do

it at least two or three times a week. The effects on your health and your ability to

study will be significant” (Cameron, 2008, p.69).

Longer quotes, using the words of the author, should be inserted in italics and somewhat indented from the rest of the text. Notice that the citation at the end of the sentence remains in the same

font size as the main text.

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More often than not though, you will have to paraphrase what the author had said in

transferring the information from the source to your answer. This means that you will say

what the author has said, but in your own words, and you could do in several ways, for

example:

The importance of exercising while studying for a qualification, is emphasised by Cameron

(2008) and she suggests that half an hour of intense exercise, two to three times a week, could

be seen as the prescribed norm for remaining fit and aware during your studies.

OR

Cameron (2008) suggests that exercise routines should be established as a way of life before

the start of a career as a student.

OR

One author (Cameron,2008) goes so far as saying that chances of successful studies may be

significantly enhanced by following a regular exercise routine while studying.

OR

There is evidence to suggest that refraining from taking breaks and exercising during these

stints away from the desk, may actually have a detrimental effect on the student’s ability to

study (Cameron, 2008).

Paraphrase: to describe what you had read, using your own words.

Note that if the citation is at the end of the sentence, then the full stop appears at the end of the citation as well, and never before it

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How to use a model when answering a question?

Question: Use the SWOT Model of analysis to analyse the information contained in the case

study on Mr Price. (See Addendum A)

Answer: When analysing an existing business strategy and when designing a new business

strategy, it is common to make use of the SWOT framework for analysis. This framework

includes Strengths, Weaknesses, Opportunities and Threats. The framework distinguishes

between two facets of the internal business environment, strengths and weaknesses, and two

features of the external business environment, opportunities and strengths (Grant,1998).

In applying the model to the facts in the case study on Mr Price, we are able to analyse the

information as follows:

Strengths

Share price rose 4% in year ending

June 2017

It used to be the darling of apparel

retailers

Company executives realise the

need to introduce a turnaround

strategy

Opportunities

The company is in a turnaround

phase

Changed procurement policy

Credit is a lever it can introduce

Mr Price needs to reinvent itself

Consumer environment will

gradually improve

Weaknesses

Drop in earnings is the first in 16

years

People do not like what they have

on their shelves

Sales volumes are down

Threats

Earnings dropped 12% in year

ending June 2017

Competitors are offering huge

discounts on merchandise

Consumers are under pressure

Cite the source of the theory or theoretical model you have used

Start with a short paragraph dedicated to an academic description of the model itself.

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International chains are entering the

market

Competitors occupying the niche it

used to hold

National credit regulator does not

like the club fee

Political uncertainty impacts on the

retail sector

Insight from application of the model: Following the application of the SWOT Model to the

case study, the following summary of insights are applicable:

Internal situation – Even though the share price of the business has picked up, the

earnings for the same period are down and management executives recognise the

need to implement a turnaround strategy. For some time now there had been an

awareness of the fact that sales volumes have been declining because customers are

not attracted to what is on the shelves.

External situation – A turnaround strategy is already underway involving a change to

the procurement policy of Mr Price and an exploration of options for extending credit

to shoppers. The management team will ride the wave of the improving consumer

environment while the business is reinventing itself. This needs to be done against

the background of the drop in company earnings and competitors offering huge

discounts. Huge international chains have been entering the SA market while local

retailers are challenged to adapt to the unstable political environment in SA.

The overall impression, from having applied the SWOT, is that a declining market position is

putting pressure on the business, creating a need for a turnaround strategy which will

reinvent the store so that it offers more competitive pricing and more appealing apparel with

easier credit options for customers. Always end with a concluding paragraph in which you

summarise your overall impression from having used the model.

Follow the model application with a paragraph or two telling the reader what you had learnt from applying the model.

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Reference:

Grant, R. M. (1998) Contemporary Strategy Analysis, 3rd ed., Oxford, Blackwell Business

Always remember to reference the source from which you got the theory on the model.

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An example of a case study based answer

Question 1: Read the case study ‘Mr Price: What went wrong at SA’s retail darling?’

(Addendum A) and respond to the following task: Do an analysis of the external environment

in which Mr Price is conducting business and then proceed to draw at least five conclusions

from the analysis which could inform the strategic decisions the management of the clothing

retailer should consider when planning the future of the business.

Answer:

1.1 Introduction

The appropriate framework to use here for analysis of the external environment

would be the PESTLE framework. The framework facilitates an analysis of the external

environment in which the business is doing business and allows for categorising

external factors in manageable and understandable sections so as to make a complex

situation somewhat more comprehensible as a basis for strategic action.

1.2 PESTLE Factors

1.2.1 Political: Political pressures are continuously influencing management decisions

as governments and their agents exert pressure on the business sector (Smit, Cronje,

Brevis & Vrba, 2013). The Political factor therefore refers to the broad political

environment in which the business is functioning.

The case study points out that consumer confidence remains very low in the country

as a direct result of the failure of the South African government to inspire confidence.

This is in turn a result of poor governance and an inability to initiate programmes of

inclusive growth. We know that this is the type of situation which creates feelings of

uncertainty because business confidence dips, making businesses less inclined to

expand and invest in business infrastructure, but it also makes consumers anxious and

these are then less likely to spend money on luxury or non-essential products.

Provide an introductory paragraph to tell the reader why you think the model or framework you are about to use is appropriate for the problem or challenge set out in the question.

Start the paragraph with a clear link to the theory

Interpret the theory in a short sentence to illustrate your understanding of it.

Apply the theory to the case study, using information from the case study itself.

The theory to introduce the discussion in this paragraph.

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Clothing retailers like Mr Price will find that their customers are more careful with

spending their money, and the retailer is likely to have a lower turnover as a result.

1.2.2 Economic: Economic factors influence the level of prosperity (or the level of

adversity) that consumers are faced with in a particular country (Smit, Cronje, Brevis

& Vrba, 2013).

This factor therefore relates to the overall health and robustness of the economy in

the country where the business is operating.

The case study points out that the consumers in South Africa are under pressure, and

that Mr Price saw a drop of 10% in its overall turnover when compared to the previous

year. The fact that a ratings downgrade produced a negative effect on the exchange

rate implies that South Africans are paying more for imported products like clothes,

and this is likely to make consumers think twice about spending money with Mr Price.

1.2.3 Social: Consumers are members of society and therefore they are inclined to

adopt the behaviours of that society (Smit, Cronje, Brevis & Vrba, 2013). This factor

therefore relates to the social environment in which the business is functioning.

The case study points out that Mr Price has lagged behind whilst other retailers in the

sector have reinvented themselves. We also know that clothes are an important

fashion item and that fashion accessories have a short lifespan. Businesses which sell

these products will not attract fashion conscious buyers if the shop selling the product

does not seem generate excitement. The case study points out the need for Mr Price

to reinvent itself in an industry which is characterised by an increasingly international

profile, and other existing, well-known retailers who are consistently re-inventing

themselves.

1.2.4 Technological: Technology is a key knowledge component in the process of

doing something, creating something or processing something (Smit, Cronje, Brevis &

Vbra, 2013). This factor is not referred to directly in the case study but it still relates

to the business of Mr Price, as would be argued below.

The theory.

Interpret the theory to show understanding of it.

The application of the theory to the case study using facts and detail from the case study.

Maintain the recipe from the two paragraphs above in answering the rest of the question.

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Apart from the fact that a retailer needs to be able to track sales very closely with

computer programmes which are using the newest data from daily sales to ensure

insight into what is selling and therefore popular enough to buy huge volumes of. any

business involved in fashion today also needs to closely track global sales of fashion

items, fashion trends generally and the social factors influencing these trends around

the world. Technology is a core competency for any business wanting to remain

connected to what is happening elsewhere in the world, and technology is also

relevant at every till-point where Mr Price makes a sale.

1.2.5 Legal: This refers to the broad legal environment and laws, legal provisions or

common legal practice which may be applicable to the business and how it operates.

It would include, for example, labour law provisions and general business law

considerations.

The article points out that the Mr Price’s club membership issues are an important

factor which the business is grappling with at the moment. This is a worrying reality

because we know that EDCON has been fingered for this same issue, and the

implication is that companies which have a paid club membership for their customers,

could possibly be faced with having to repay these fees: - something that a struggling

retailer may find extremely difficult or impossible to do given the current economic

environment.

1.2.6 Environmental: The ecological environment holds the physical factors of

production. Businesses need to produce, manufacture and create the products they

sell (Smit, Cronje, Brevis & Vrba, 2013), and whilst producing businesses must keep in

mind that customers are becoming increasingly aware of the need for greening the

environment and leaving a smaller footprint on the earth.

The case study does not refer to any environmental issues directly, but we know that

clothing retailers are all being scrutinised more and more for importing fabric which

may be grown on a huge scale in agricultural environments that do not follow

sustainable farming methods. Customers are also becoming more inclined to choose

retailers that have an involvement in promoting sustainable social practices, (e.g.

When answering case study questions. It is acceptable to make reasonable assumptions.

Reasonable assumption

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where they don’t provide plastic bags for purchases from the shop or where they rent

retail space from shopping centres that use green energy.

1.3 Strategic actions for Mr Price

The analysis resulting from the PESTLE framework highlights a few important issues

which Mr Price should be aware of during the strategic management planning process.

These include the following:

the political environment is likely to remain volatile for some time to come

and this can be expected to continue to affect business confidence as well as

consumer confidence with a resultant subdued inclination to spend money

on the products the business sells

the business should keep an eye on the investigation into the EDCON Club

membership issue and the legal processes it is undergoing, as this could have

an important effect on Mr Price and how it manages its own club

the business needs to ensure that its merchandise remains at the cutting

edge of fashion trends, as this is a key survival issue for the business

the economy of the region is likely to remain a key issue and continue to

impact on the business; it would be worthwhile for the business to use

experts in the monitoring and prediction of economic developments

Even when the question does not explicitly state that you have to draw conclusions from having applied a model to the case study facts, you should in any case do this as it is only natural that you should always answer the final question: ‘What did I learn from doing this application of the theory to the real life scenario?”

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How to write a concluding statement?

A good student will choose to end an answer with a natural conclusion. The concluding

statement is a summary of what had been discovered in the process of answering the

question.

Here is an example of what the typical concluding statement may look like:

The question prompted the application of the PESTLE Framework to the Mr Price case study

detail. The core management problem within the case study is the fact that the business is

increasingly losing ground in the home apparel business as competitors offer discounts and

more trendy merchandise to a similar target market. The application of the PESTLE

Framework helps to illustrate why the business needs to reinvent itself and how it can use

the current, slow economic environment to reconfigure the quality and range of the

merchandise it offers, by making more extensive credit options available to customers.

These strategic realignment actions would ensure that the company is ready for the

resurgence of the buying power of the average consumer once the economy recovers.

Repeating the management problem confirms understanding of the underlying message in the

case study. A summary of what the result was of the

model or framework application.

The closing sentence is summarising the solution produced by the analysis.

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Checklist before handing in your assignment

Before handing your assignment in, spend a few minutes checking if you have included in it

everything that is important and would contribute to a good mark.

Check Checklist

Does your name, course code, student number appear as the header on every

page?

Does every new answer start on a new page?

Are you answers clearly numbered?

Are the subheadings clearly numbered?

Did you make sure that there are paragraphs with open lines between them?

Are the pages numbered?

Did you provide an ‘Index Page’?

Are the items in your reference list appearing in alphabetical order?

Are the answers you provided in line with the available mark allocation?

Are you using the correct font and size?

Are you sure that the laptop you are using is set to provide ‘South African

English’ as part of the spellcheck function?

Did you spellcheck the document and made sure that language and other errors

have been eliminated?

Have you included in-text citation correctly?

Is your ‘Reference List’ on the last page of the submission?

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The structure of a good reference list

A good reference list will always contain the following characteristics:

Reference List

Adair, J. (2016) The Guide To Concise Time Management and Personal Development,

London, Thorogood.

Andrea, S. and Faulkner, C. (1996) NLP: The New Technology of Achievement, Bowick,

Patterson’s Publishing

Edenburgh, D. (2004) ‘Intangible Assets’ Academy of Accountancy.

>http://www.academy.org.uk/publications< [Accessed on 3 June 2017].

eatout.co.za, ‘Giving Italians Restaurants in Melville a Go for Their Money’ [Accessed on 18

July 2017]

Martins, W. (1989) Making sense of Metrics in Strydom, M.Y., ed., Capital Growth, Houston,

Time Publishing, p. 15 – 17.

Newman, R. T., ‘The Bland in Brand’, The Journal of Brand Management, Vol. 9 (3), p. 23 –

50.

This needs to be on a separate page, the

title in the middle of the page and it is not

called a ‘Bibliography’.

The surname of the book’s

author first, followed by the

initial(s)

The date of the book

publication is always in brackets.

The title of the book is always written in Italics

The city of publication

The name of the publisher

For books with more than one author, all authors are mentioned in the order they

appear on the jacket of the book. Virtually all internet articles have authors attached

Internet articles with no author, are listed according to the Website name – no www or https to start with

Books written by a number of contributors requires you to mention the name of the person who wrote the chapter from

which you are quoting first.

The title of the chapter you are quoting from then follows – note the title in

italics

The author who collected the chapters (the editor) is mentioned followed by the abbreviation ed.

The page numbers containing the chapter you used to quote from.

The author of a Journal article.

The title of the article in inverted commas.

The title of the Journal from which the article came in

Italics

The Volume number of the Journal

and the Issue number

following it in brackets.

The page numbers containing the article.

http://www.academy.org.uk/publications/

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Note: a full breakdown of how to effectively use the Harvard Referencing system both in-

text and in the reference list is available on eLearn. Please consult this for full details

on how to reference as this will help you to avoid any potential plagiarism issues.

Did you notice the following key characteristics of the good reference

list:

the sources are listed alphabetically,

the sources are not numbered,

the sources do not have bullet points,

commas, full-stops and italics appear in very specific places,

there are spaces left open between every listed source.

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Conclusion

This guide was compiled with the idea of providing a simple, basic framework for starting to

appreciate and develop good study habits.

Here are a few other sources you could approach for more elaborate and higher level advice

and guidance:

www.educationcorner.com

www.skillsyouneed.com

www.lynchburg.edu

www.openuniversity.edu/resources/study-skills

In addition to the resources listed above, there are also resources available on eLearn.

These include:

The Module Pacers (to help you structure study time)

How to answer case study questions?

How to study for open book examinations

Calendar of events for the semester ahead

http://www.educationcorner.com/

http://www.skillsyouneed.com/

http://www.lynchburg.edu/

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Reference List

Cameron, S., (2008) The MBA Handbook, 6th ed., London, Prentice-Hall.

Grant, R. M. (1998) Contemporary Strategy Analysis, 3rd ed., Oxford, Blackwell Business

Pugh, D. S., (1973) ‘Does Context Determine Form?’ in Pugh, D. S., ed., Organisation Theory:

Selected Classic Readings, 5th ed., London, Penguin Books.

Smit, P.J., Botha, T., Vrba, M. J., (eds) Management Principles: A Contemporary Edition for

Africa, Cape Town, Juta.

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Addendum A:

Mr Price: What Went Wrong at SA’s Retail Darling

https://www.businesslive.co.za/fm/money-and-investing/2017-06-08-mr-price-what-went-

wrong-at-sas-retail-darling/

FASHIONING A MATERIAL TURNAROUND

Mr Price: what went wrong at SA's retail darling

The retailer has experienced a challenging time, and opinions differ about whether it is over

the worst.

Picture: FREDDY MAVUNDA

When Mr Price posted its full-year results last week, its share price rose nearly 4% — and

spiked to an even higher level in the course of the day. This was in spite of it posting a 12%

drop in earnings.

The earnings decrease, its first in 16 years, marks a dismal milestone for the company, which

has for years been the darling of apparel retailers.

The market appears to hold the view that Mr Price is in a turnaround phase and is focused on

regaining market share from competitors. It’s not quite clear what this involves other than

sourcing better products to appeal to more shoppers, but the increase in share price suggests

buy-in.

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The retailer has been fighting in a maelstrom of frenzied price discounts, as its traditional

competitors have promoted these more heavily than before in a tough landscape. Consumers

are under pressure, and international chains such as H&M, Cotton On and Zara continue to

reshape the landscape, offering fast fashion.

Mr Price, which also sells homeware and furniture, maintained its full-year dividend, which

has not declined in the past 31 years, at 667c/share. The final dividend was 438.8c/share, up

4.7% on the previous comparable period. Total revenue increased 0.7% to R19.8bn, with retail

sales decreasing 0.5% to R18.6bn and comparable stores down 3.6%.

The apparel sales since the year end — combined with the identification of issues of the past

year related to inventory, such as seasonal shifts and getting the fashion wrong — have given

the market some confidence that there is a turnaround.

Ashburton Investments fund manager Wayne McCurrie says: "The true problem was that [Mr

Price] got its fashion wrong in Mr Price Apparel. People didn’t like what it had on its shelves.

It had lots of sales, but people didn’t want to come in and buy what it had.

"[That is] not unusual — it does happen."

Sales volumes were heavily negative at Mr Price Apparel, including at Miladys.

Overall, sales volumes were down about 10% in volume terms.

However, "that unloved fashion is now out of the system. The new lot looks quite good," says

McCurrie.

Mr Price has changed its procurement policy. Competitors are doing less discounting and,

says McCurrie, "it looks as if [Mr Price] is achieving a turnaround from the very poor year it

had last year. It’s still early days, but the market has certainly liked what it’s seen."

Mr Price has positioned itself to be differentiated, as it offers a wide range and low price.

Competitors tend to offer either a small range, or a big range at higher price.

"It felt a lot of its competitors moved into its niche," says McCurrie. This wasn’t helped by

very weak economic growth last year.

"We believe it’s a turnaround story. It probably won’t get worse than it did last year, when

there was an accumulation of mistakes: new competitors, higher than normal discounting and

a very poor economy. And the company got the fashions wrong."

Last week Mr Price was referred to the consumer tribunal after an investigation by the

national credit regulator showed that the retailer charged consumers a club fee on credit

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agreements, which is not allowed by the National Credit Act. This could cost it up to 10% of

its annual turnover.

The company says it will oppose the referral, as it does not agree with the view held by the

regulator.

Other retailers have already been referred to the tribunal in this regard, including Edcon.

Jean Pierre Verster, portfolio manager at Fairtree Capital, says: "There seems to be a lot of

noise, and a lot of retailers have fallen foul of technicalities of the act. We are waiting to see

what happens there. Hopefully it won’t have a material impact.

"It does seem as if credit is increasingly a lever Mr Price wants to pull as well, a mechanism it

wants to use to stimulate sales. It needs to play by the rules if it wants to use it to compete

with more credit-based retailers such as Truworths, TFG and Edgars."

Verster says the marked price difference between Mr Price and its competitors has shrunk to

a point where it’s small enough for customers to go elsewhere.

"Whether this is a sustainable turnaround needs to be seen," he says. "We’ll have a better

idea at the interim stage."

Not everyone buys into the idea of a turnaround. Senior equity analyst at Sasfin Securities

Alec Abraham says: "The performance was bad. I think to say it’s a turnaround is to clutch at

straws. I don’t think there’s much of an improvement in the economy. They say the turnover

of Mr Price and Miladys is up a combined 10% this year, but one swallow does not a summer

make."

Abraham says the problem extends beyond Mr Price to all local apparel retailers. "They need

to reinvent themselves for this new, structurally different clothing environment. In the old

days it was very cushy — everybody had a place. Now there are other [players], and the SA

retailers need to find their place in the new structure."

Mr Price was largely unchallenged "in the old regime, but now, all of a sudden — partly

through its own doing and also because both the international and the local companies are

trying to up their game – the differentiation between everyone else and Mr Price has

narrowed. The company needs to do something to cope with that."

Mr Price says any improvement in the consumer environment is likely to be gradual. "The

year proved to be exceptionally challenging for the retail sector. Consumer confidence

remained low as a result of the poor state of the local economy and a lack of faith in the

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current political leadership’s ability to set high standards of governance and deliver inclusive

growth.

"Cabinet reshuffles and downgrades by ratings agencies have caused further exchange rate

volatility, which the consumer ultimately has to absorb. As a result, the retail environment

has become more competitive, with any growth in a stagnant market coming from increased

market share. This has led to retailers in our sector increasing their promotional activity to

drive sales and manage stock levels."

Finance group HSBC expects virtually no growth in apparel sector profits until 2019. According

to Bloomberg, HSBC analysts Jeanine Womersley and Harshul Sharma said in a note that SA

consumers are "unlikely to see a cyclical recovery in 2017, and even if this does materialise,

it’s unlikely to be of the magnitude required to offset the structural headwinds we believe

face the sector".

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