Trade and Poverty Case Study: Small Household Appliances

South Africa manufactures a diverse range of small household appliances. Increased international competition has forced a substantial restructuring of the domestic industry and existing suppliers have become leaner, more focused and much more profitable. Although the two market leaders continue to manufacture locally, the primary activity of both companies has switched from manufacturing to importing and brand management. The recent financial performance of these companies is impressive and their brand presence within South Africa remarkably strong. It would appear that South African manufacturers of small household appliances have adapted very well to the ‘threat' of international competition and have captured most of the gains. The gains to consumers, in terms of product variety and quality, have also been substantial; and the employment losses have been small. But input and output prices remain distorted by unnecessary tariffs and South African consumers continue to pay a high price for basic home appliances.