Surprising revelations about South Africa’s electronics market

Independent retailers in South Africa make up about 35% of the electronics and appliance market in terms of sales, Iser-Expert CEO Jonny Aarons has told MyBroadband.

Iser-Expert is a purchasing organisation established in the 1990s to consolidate the buying power of independent resellers and prevent bigger competitors from trampling them.

Originally incorporated as Iser, the organisation’s founding members included Kloppers, Hirsch’s, and Tafelberg.

Hirsch’s eventually broke away from the Iser-Expert alliance and now handles its own buying.

In 2015, Iser became affiliated with Expert Group, a retail alliance founded in 1967 that provides support and services to retailers of consumer electronics and appliances.

The buying group targets product categories like small and large appliances, houseware, air conditioning, cellular, tablets, wearables, personal care, and outdoor.

Iser-Expert also operates a website for Expert Stores, selling consumer electronics, and small and large appliances.

Aarons told MyBroadband that Iser-Expert has 450 independent stores in their South African network.

Seventeen of those have been granted permission to use the Expert brand.

For example, Kloppers and Tafelberg co-brand stores carrying products sourced through their purchasing venture as Expert Kloppers and Expert Tafelberg.

This strategy has proven successful, with Iser-Expert achieving an annual average compound growth of 17% over its previous three financial years.

“It has worked. The independents in South Africa, if you include Hirsch’s — because they are owner-managed — are at least 35% of the market in electronics and appliances,” Aarons told MyBroadband.

“That’s because of the buying group setup.”

Other buying groups contributing to that figure in South Africa are Shaw Group and Group Appliances.

“We most probably make up about 65% of the independent market, excluding Hirsch’s,” Aarons said.

Aarons said there is a common misconception that prices at independent stores are necessarily higher than at major retail chains.

Buying groups have ensured that this is not true, allowing independent retailers and owner-managed groups to compete on an even footing with the larger players.

He highlighted that Kloppers frequently performed well in MyBroadband’s price comparisons for various consumer electronics.

Kloppers, and specifically the sons of the late Willem Klopper, were instrumental in establishing Iser in the nineties.

Coincidentally, Expert and Kloppers were founded in the same year — 1967.

Kloppers set itself apart from other retailers with its “cash is king” motto.

Instead of selling goods on credit at high profit margins, it focused on higher turnover and offered cash customers better prices.

The company also has a storied history.

Expert Kloppers outlet at Castle Gate Lifestyle Shopping Centre — computer and gaming department

In 1981, it bought the 10,000-square-meter Greatermans branch in Bloemfontein when the company closed its South African branches in 1981.

In 1983, Willem Klopper received a very attractive offer from Christo Wiese’s Pepkor. He sold the business with the former Greatermans building and retired at 57.

Some of the Kloppers directors went to work for Pepkor, but three of Klopper’s sons — Willem Jr, Steva, and Leon — broke away.

In 1984, they launched a new shop called Juniors on the premises of the old Kloppers.

This drew the ire of some of the new Kloppers directors, who vowed to shut the brothers down within six months.

As the brothers tell it, this was like waving a flag before a bull.

Two years later, Kloppers was all but handed to them on a silver platter and merged into Juniors.

In the years that followed, the Juniors name was retired, and three more Klopper brothers joined the business.

Kloppers has steadily expanded its footprint outside Bloemfontein, launching stores in George, Knysna, Gqeberha, and, most recently, Pretoria.

The company held a grand opening event for its Expert Kloppers store at Castle Gate Lifestyle Shopping Centre in Erasmuskloof, just East of Centurion, on 1 June 2024.

“The success of the Pretoria store opening has set the stage for more exciting events to come,” the company said.