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The Sales Managers' Index: Africa

Released: July, 282015

African SMI continues to signal solid growth in July

  • Manufacturing and Services activity strong across Africa
  • Nigeria leads Pan-Africa economic expansion
  • Sentiment most upbeat in Nigeria, Egypt and Algeria

The Headline Sales Managers’ Index for Africa posted 59.3 in July, indicating an on-going strengthening in business conditions across the African continent. Business confidence remained very buoyant in July with market and sales growth continuing to expand at a slightly faster pace from June. Prices charged were stable while staffing levels continued to moderate.

Of the biggest economies, Nigeria registered the highest monthly growth reading (65.5), followed by Egypt (64.6), Algeria (61.0) and South Africa (57.7). Although conditions were favourable in all these countries, panellists expressed concerns about falling energy prices, security issues, and power outages.

Sector analysis indicates that the Pan-Africa Manufacturing SMI remained high at 57.7 in July, and the Services SMI equally remained high at 59.7. These figures show a continuing strong improvement in business conditions for both sectors across the region.

The Business Confidence Index, which measures how Sales Managers’ expect the economy to perform over the coming months, remained very high in July. Companies in Nigeria, Egypt, and Algeria were the most upbeat, while South African companies were the least optimistic.

Meanwhile, the Market Growth Index rose again in July to register a value of 58.3. This indicated that companies across the Pan-African continent are still experiencing solid levels of market expansion. Market growth continued to accelerate at a rapid pace in Nigeria, Egypt, and Algeria while market growth in South Africa fell for the first time in 12 months. Similarly, the Product Sales Index rose further in July to stand at 54.7, up from 54.3 in June. This was the third straight month of increase and the fastest pace since January. In particular, sales continued to rise at a strong pace in Nigeria, Egypt and Algeria while sales fell in South Africa.

On the inflation front, selling prices were unchanged in July, with the Prices Charged Index posting 55.5, stable compared to June. This suggested that sales managers continued to pass on price increases to customers and businesses at a strong pace.

The Staffing Levels Index, which reflects the number of staff taken on compared to the same period last year, inched down to 52.5 in July by just 0.1. This signalled modest levels of job creation across the African continent. Notably, employment growth eased in Egypt, Algeria and South Africa, while job creation in Nigeria rose at stronger rate.

World Economics Chief Executive Ed Jones commented on the release:

“Latest SMI’s data for Africa indicated that business conditions across the continent continued to improve in July. This was supported by high levels of business confidence, with market growth and product sales registering stronger rises over the month. ”


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Notes to Editors
The SMI’s (Sales Managers’ Indexes) are compiled and analysed by World Economics and are based on survey data collected from a panel of African companies stratifying all Industry Classification Board (ICB) sectors.

The Sales Managers’ Index results are calculated as diffusion indexes which have the characteristics of leading indicators by taking the percentage of respondents that report that activity has risen (“Increasing") and adding it to one-half of the percentage that report the activity has not changed (“Unchanged"). Using half of the “Unchanged" percentage effectively measures the bias toward a positive (above 50 points) or negative (below 50 points) index. An example of how to calculate a diffusion index: if the response is 40% “Increasing," 40% “Unchanged," and 20% “Reducing," the Diffusion Index would be 60 points (40% + [0.50 x 40%]). A value of 50 indicates "no change" from the previous month.

The more distant the index is from the amount that would indicate "no change" (50 points), the greater the rate of change indicated. Therefore, an index value of 58 indicates a faster rate of increase than an index value of 53, and an index value of 40 indicates a faster rate of decrease than an index value of 45. A value of 100 indicates all respondents are reporting increased activity while 0 indicates that all respondents report decreased activity.

Three month Moving Averages are applied to each index to mitigate the effect of seasonal variations, original unadjusted data are not revised after publication.

About the Sales Managers’ Indexes
The Sales Managers’ Indexes are a series of products developed by World Economics which counts panellists in over 70 countries worldwide. Designed to raise the voice and profile of sales people throughout the world, the Sales Managers’ Indexes provide the earliest indication each and every month of the direction of economic activity, and the speed at which its markets are growing.

Sales Managers are unique as an occupational group in being right at the front line of economic activity. The Sales Manager is ideally placed to feel the first few whispers of caution in the market or to see the new green shoots of economic recovery.


The Sales Managers’ Index brings together the collective wisdom of Sales Managers and consequently produces the best and earliest source of understanding about what’s really happening in each economy.

The Sales Managers’ Index has been developed by World Economics, a leading edge provider of original economic data. Sister products include the World Price Index, Global Marketing Index, World Economics Journal, as well as country level Growth Trackers.

About World Economics
World Economics is an organisation dedicated to producing analysis, insight and data relating to questions of importance in understanding the world economy. Its parent company Information Sciences Ltd has a long history of the development of key business information today used throughout the world, including the origination of the Purchasing Managers Indexes in Europe and Asia (now owned by Markit), and the development of WARC a global information provider for major corporations .

Currently our primary research objective is to encourage and assist the development of better and faster measures of economic activity. In cases where we believe we can contribute directly, as opposed to through highlighting the work of others, we are producing our own measures of economic activity.

Our work is mainly of interest to investors, organisations and individuals in the financial sector and to significant corporations with global operations, as well as governments and academic economists.

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