‘Tough times cause slump behaviour’

Staff reporter - Namibia has been going through seven-year cycles of ups and downs, according to Daniel Kavishe, market research manager at FNB Namibia.

Kavishe recently spoke at an educational breakfast for journalists.

Speaking about the average rate of growth in Namibia, money cycle and property market, Kavishe said cyclical behaviour is typical of most economies. It is therefore crucial to understand the behaviour that ensues.

During tough times, consumers and businesses “adopted” so-called slump behaviours, said Kavishe. Certain characteristics became evident in society - erratic price behaviour, high unemployment, structural changes, industrial action, declining output due to waning demand and trade increase.

Consumers are known to start bargaining during slump times, they window shop instead of buy, and go for price and not brand loyalty. They resort to “I deserve” purchases and make use of credit where possible, said Kavishe.

“Businesses during slump times focus on cost management. Mergers and acquisitions become more regular, clever pricing is done, while structural declines and mechanisation are looked at more closely,” he said.