Promo is becoming ever more interconnected globally, with distributors increasingly called on to meet clients’ needs across national and continental boundaries.

Now, ASI Research is helping industry firms domestically and abroad better understand the merch market across geographies with a worldwide debut: the first-ever study of the South African promotional products industry.

Nate Kucsma, ASI’s senior executive director of research, and Michele Bell, senior vice president of content and global alliances, spearheaded the creation of the study in conjunction with Amrod – a South African-headquartered supplier of apparel and hard goods that is the African continent’s largest promotional products supplier.

The report builds on U.S.-based ASI’s pioneering efforts in the global merch market, which include landmark studies of the European branded merchandise industry, being a lead member/co-founder of international industry partnership organization PromoAlliance and through decades of transcontinental promo relationship-building activity, trade show participation and media coverage.

The South African study offers insight into top-selling promo products, the most lucrative end-markets for sales, margins, distributor operations, sourcing practices and more in a nation that has a projected 2025 annual gross domestic product of about $410.34 billion, making it Africa’s largest national economy.

“It’s very rare that you get the chance to do something for the first time, so when the opportunity arose to conduct the first-ever comprehensive look at the South African promo market, we jumped at the opportunity,” says Kucsma. “While there were of course differences between the South African market and those in North America and Europe, promo products were again proven to be a viable and robust business around the world.”

The South African promo market does not have an ASI-like entity/promo association. As such, it lacks trade shows, data-driven market analysis and an industry-specific media/research outlet. Keen to improve on that, Amit Brill, founder and co-CEO of Amrod, and Gabi Bricker, Amrod co-CEO, approached ASI about conducting an analysis of South Africa’s promotional products industry.

ASI Research gained access to the thousands of distributors that Amrod serves and conducted a survey of them. The response rate was a robust 34%. ASI ultimately based the survey results on the responses of 1,311 South African promo pros – with a limit of one respondent per company, in each case the firm’s highest-ranking officer.

“While there were of course differences between the South African market and those in North America and Europe, promo products were again proven to be a viable and robust business around the world.” Nate Kucsma, ASI

Top Products & Markets

During the week of May 11, Bell traveled to South Africa to present findings from the study at the Amrod Promotional Products Summit, a biannual event the supplier hosts in Johannesburg. Approximately 900 Amrod distributor clients attended the summit – really the only forum in South Africa for bringing promo pros together en masse.

“We host the Amrod Promotional Products Summit to elevate and professionalise our industry,” says Bricker, noting Amrod is celebrating its 25th anniversary. “It’s about creating a space where promo professionals can learn, connect and lead – together. The summit exists to spark real conversations, showcase innovation and remind us all of the strategic power of branded merchandise. As the industry evolves, so must we – and this event is our way of helping drive that evolution forward.”

The South African promo market study helped advance the summit’s mission. Among the key findings? The top five most popular promo product categories among end-buyers in South Africa are, in order, golf shirts, T-shirts, corporate wear, drinkware and notebooks. “Just as is the case in North America, apparel dominates the most sold product categories, only to be broken into by drinkware, which is also North America’s leading hard goods product,” says Kucsma, referring to research from Counselor’s State of the Industry report on the North American promo space.

Meanwhile, just as on this side of the Atlantic, the education sector provides the most fertile ground for promo sales in South Africa, with distributors naming it the top market in which to generate business. Rounding out the top five markets for South African promo product sales are, in order, ad agencies/marketing, hospitality, professional services, and financial/insurance. In North America, the top five markets were education, healthcare, construction, manufacturing/distribution, and financial/insurance, according to State of the Industry research.

“Two of the top five markets – education and financial/insurance – were the same in South Africa and North America but one market that’s a major driver of business in the United States especially, healthcare, was notably less of a sales producer in South Africa,” Kucsma explains.

Bell shared such findings and more during two presentations at the summit – each with several hundred South African distributors in attendance.

“It’s really beneficial for us in South Africa to be able to benchmark some of our metrics, both from a perspective of market reach in our context versus the U.S., and also in respect to the similarities and differences in the categories making up the top tiers of sales in both markets,” says Malcolm Herbert, chief financial officer of distributor Sapphire, which has offices in Johannesburg and Cape Town. “Michele Bell shared valuable insights from ASI that we can take forward here in our home markets.”

It’s a point with which Gavin Marks agrees. “It was refreshing to see some numbers,” says Marks, director at Alligator, a leading South African distributor. He praised the summit too. “It was a truly professional and enjoyable few days. Hats off to the Amrod team on their milestone achievement of 25 years in the industry as market leaders delivering a world-class service and for the passion and innovation they bring to the table each day.”

Sales & Margins

The ASI Research study also delves into distributor sales growth.

Notably, 56% of responding South African distributors say their sales were greater in 2024 than they were in 2019. Put another way, that means that nearly 6 in 10 distributors in South Africa generated more revenue in 2024 than they did in the last full pre-COVID year, suggesting a fairly broad recovery from pandemic-era disruption. Even so, about a quarter of South African distributors’ sales were lower in 2024 than in 2019, indicating some are facing headwinds.

The ASI Research report analyzes distributor margins, too.

The average distributor markup in South Africa in 2024 was 31.6%, below the average U.S. margin of 37%. Interestingly, margin varied based on a distributorship’s annual revenue size.

For instance, South African distributors that produce more than R20 million annually – what ASI terms “extra-large” distributors – had the highest average margin last year: 33.4%. Distributors doing below R1 million – what ASI terms “small” distributors – had the lowest average margin: 30.9%. Midsized distributors (R1 to R5 million) were at 32.9%, while large distributors (R5 to R20 million) tallied a 32.5% margin.

Note: South Africa’s currency is the rand, and “R” is a monetary denotation like the U.S.’ “$.” At the current market rate, one U.S. dollar equals more than 18 rand.

Summit attendees found the insights on sales performance, average margin and more enlightening.

“Being entrepreneurs, we often make decisions based on impulse,” says Roger Fitzsimons, CEO of Promobasket and Big Eye Branding, South African firms that provide promo solutions throughout the African continent. “It’s very useful having industry data from ASI for the first time in our existence to give us some insights on how our industry trades and how we are tracking. This allows us to make more educated strategic choices going forward and hopefully helps reduce mistakes.”

Distributor Operations

ASI Research indicates that the South African promo market appears to be fragmented in the sense that a variety of entrepreneurial small to midsized businesses operate in the space, as opposed to just a handful of behemoths.

To wit, nearly 42% of survey respondents report that their companies generate less than R1 million per year. Another 30% do R1 million to R5 million. Extra-large distributors bringing in above R20 million made up just 4% of respondents, while those with R5 million to R20 million accounted for 11% of survey replies. Some 13% didn’t wish to share their revenue level.

Research further suggests that some distributors are finding longevity in the South African market, but also that newer distributorships are popping up.

More than a quarter of responding distributorships – 27% – have been in business for 11 to 19 years, while 20% have been operating four to six years and another 20% seven to 10 years. Those with 20+ years of experience account for 17% of survey respondents; those in business for three years or less were 16% of survey repliers.

A firm majority of South African distributors say that promo is their primary business, with 65% across all annual revenue categories reporting that to be the case. Distributors provide other/related services, too. Consider: Nearly 7 in 10 offer small- or large-format printing, 64% deliver graphic design services, 57% can give customers signage printing/creation solutions and 44% will help with creative marketing services.

A notable contrast to the U.S.? The prevalence of online company stores. Only 5% of South African distributors serve clients with webstores, while 46% of American distributorships report doing so. Also worth noting: 8% of South African distributors provide warehousing/fulfillment and 7% do kitting.

These and other findings shared at the Amrod Summit proved eye-opening for some distributors.

“The entire summit was amazing, as the speakers and information presented is invaluable,” says Abdullah Karani, CEO of Yankee Corporate & Branding Specialists, a South African distributorship. “The ASI data presented has inspired my team to understand more trends within the South African market and motivated them to reach a wider market. We look forward to Amrod’s next summit.”

Sourcing Practices

South African distributors generally source from a handful of select suppliers.

On average, distributors purchased products for end-clients from four suppliers in 2024. South Africa’s extra-large distributors work with an average of seven suppliers. That was more than double the three suppliers that the industry’s small distributors worked with in the same year. Midsized and large distributors partnered, on average, with four and five suppliers, respectively.

The top reasons distributors purchase from a given supplier are product quality (cited by 96% of survey respondents), branding quality (95%), product availability (94%), order lead times (89%), product selection (85%), trust in the suppliers trade-only policy (83%), price (83%), one’s account manager at the supplier (67%) and payment terms with a supplier (49%).

In South Africa, distributors often need suppliers to swiftly fulfill orders. Three-quarters (75%) of orders require a turnaround of five days or less. In North America, five-day-or-less orders constitute just 29% of total orders, Counselor State of the Industry research shows.

Despite those rapid turn times, South African suppliers are often, though not always, able to come through in the clutch, distributors say. Survey results show that 85% of orders arrive on time.

Even so, there could perhaps be some room for improvement on accuracy. South African distributors report that nearly 19% of orders contain some type of error on the part of the supplier. That compares to 12% in North America.

While mistakes happen on nearly one-in-five promo orders in South Africa, distributors generally express satisfaction with the jobs suppliers are doing. For instance, 93% of South African distributors say they’re satisfied with the professionalism of suppliers, while 90% are satisfied with general branding lead times offered, 86% with the introduction of new products by suppliers and 87% with supplier stock depth.

Another area that could possibly be enhanced? The number of suppliers in the market.

Just under 8 in 10 distributors (79%) say they are satisfied with the selection of suppliers in the industry. That could be a contributing factor to why some 60% of South Africa’s extra-large distributors do at least some direct importing of products. The percentage declines dramatically the smaller the firm gets. Only 15% of small distributors import directly, with the percentage rising to 21% for midsized firms and 32% for large companies.

South African promo leaders plan to use such information as they continue to shape their firms’ futures.

“I found [ASI’s data presentation] truly engaging and thought-provoking,” says Linda Eagle, managing director of Brand Name Marketing, one of the largest distributorships in Africa and a member of the WAGE Group, an international network/association of high-performing promo companies. “The insights and data shared are exactly what we need as business leaders in South Africa to make informed, relevant and future-focused decisions.”