Retail: Turnover will exceed 4 billion euros this December, retailers estimate

The turnover of retail in December this year, according to retailers’ estimates.However, despite the positive sign in turnover, the trade says it still faces new challenges this Christmas.

“Greek traders, however, have learned to operate in adverse economic conditions and through hard work to succeed. This will happen this year as well,”says the president of the Chamber of Commerce and Industry and the Regional Council of Chambers of Commerce of Attica Vassilis Korkidis to APE-MPA, although he estimates that “the consolidated accuracy will be reflected in this year’s festive market as well.”

Meanwhile, on the question of how will Greek consumers shop in the upcoming holiday season? As Thanos Mavros, partner at EY Greece and head of EY’s Consumer Products and Retail Sector in Southeastern Europe, explains to APE-MPE, according to this year’s edition of EY’s Future Consumer Index Greece, more than half of respondents (54%) said they will spend about the same, while 4% intend to spend more.

Inflationary pressures and the holiday shopping season In a statement to APE-MPE, the president said: Inflationary pressures are continuing and retail businesses will take the hit again this year during the festive season. It is no coincidence that the findings of the survey of payments and shopping in which the significant impact of inflation on consumer behaviour is reflected, with 8 out of 10 Greek consumers being affected by it, surpassing the global average (7/10). The EY Future consumer Index study notes that 6 out of 10 are looking for economical products giving primary importance to price. So as we enter the ‘heart’ of the Christmas festive season, it is telling that 5 out of 10 Greek consumers find it difficult to decide which products to keep and which to remove from their Christmas basket, while 3 out of 10 consumers will spend most of their money on food shopping. More than half of Greek consumers intend to prioritise family commitments and social choices, 2 in 10 will spend more and 3 in 10 will reduce spending on non-essentials, spending less compared to previous years.

This December’s retail turnover forecast to exceed last year’s levels and move above €4 billion looks set to be realised, while consumer preferences for gifts remain firmly the same, with clothing and footwear at the top, followed by gifts, toys and cosmetics. It is estimated that 2024 will end with low single-digit growth for Greek retailing, which is in fact largely inflationary and does not entail a corresponding increase in real consumption. ELSTAT data show that the largest firms in the sector are the winners over the smaller ones, with the inflationary crisis actually causing the gap between them to widen, given that the “big” ones can pursue a more extensive supply policy.

The value of shopping over the Christmas period is also expected to be higher this year than last year as consumers are estimated to spend more on average than the €174 per capita in 2023 and €146 in 2022, given that the Christmas table will also be more expensive. The data is derived from the study recording consumer trends in the retail sector and according to the EY Future consumer Index this increase is attributed to both the inflationary pressures at 3% recorded by prices and the increase recorded by the average consumer income. The intention to shop in the festive season is also linked to the age of consumers as between 18-29 years old, 7 out of 10 say they will shop and 3 out of 10 will shop for branded products. Similarly, in the 50-64 age group, 5 in 10 will shop based on price and 4 in 10 are skeptical of their affordability.

It is clear that the market will “warm up” with the payment of the Christmas gift, but also with the additional help the government has given to households facing increased needs. The cumulative amount paid out last year is expected to increase to close to 1.2 billion euros from the reduction in unemployment to 9% and the 6.4% annual increase in private sector wages. We therefore expect it to cover family and social needs for the holidays, while equally substantially boosting consumer spending. The vast majority of shopping is expected to take place for 4 in 10 up to a week before Christmas and for 6 in 10 in the week of Christmas with a large proportion of the public waiting for their Christmas present to go ahead with their festive shopping. All of these figures show that despite a positive sales trend, the retail sector faces new challenges this Christmas again this year. However, Greek retailers have learned to operate in adverse economic conditions and through hard work to succeed. This will also happen this year!

Consumers’ mood for festive shopping But how Greek consumers will shop during the festive season was discussed by Thanos Mavros, partner at EY Greece and head of EY’s Consumer Products and Retail Sector in Southeastern Europe, on the occasion of this year’s fourth edition of EY’s major consumer survey, Future Consumer Index Greece, which investigated the intentions of Greek consumers for their holiday spending.

More than half of respondents (54%) said they will spend about the same, while 4% intend to spend more. At the same time, however, about one in three (36%) said they intend to spend less than last year.

“Interestingly, here, Black notes, intent to holiday shopping is directly linked to the age of consumers. Specifically, just 26% of respondents aged 18-29 said they would spend less or not at all, while this figure doubles in the 50-64 age group (50%).”

Respondents were also asked about the most important criteria on which they would base their purchases this Christmas and New Year. Predictably, price emerged, by far, as the most important criterion (95%), followed by quality (65%). Consumers, and particularly the older age groups, also attach importance to whether the product is on sale (55%), while for 28% of consumers aged 18-29, the brand of the product is also important.

As Mr. Mavros explains, “these findings are not surprising – consumers in Greece, as well as around the world, are facing a pressure environment from 2020. From the changes in daily life brought about by pandemic and high inflation, to the climate crisis and the need to adapt to a more digital world, it stands to reason that past consumer behaviours are being reshaped.”

As a reminder, EY’s research has been tracking consumer responses to challenges and analysing emerging trends for the past four years. In this year’s survey, therefore, consumer sample concern about the cost of living and their finances is, understandably, the dominant trend (Affordability First – 33%) and co-exists with concerns about health – physical and mental – (Health First – 22%) which have been reinforced. At the same time, there are also concerns about the impact of purchasing choices on the planet (Planet First – 21%) and less so on society (Society First – 12%), while the proportion of mainly younger consumers who emphasise consumer experiences is increasing (Experience First – 12%, up from 20% last year).

These key consumer typologies, with different concerns and priorities, require different, tailored approaches from businesses. “But the equation is complicated as, at the same time,” Black points out, “we see consumers reacting differently to a range of other issues. Many are turning to online shopping, others continue to prefer physical stores, while for many the home is becoming a central hub of consumption, but in a different way to the pandemic period. Some consumers recognise that AI can make their choices easier, but the majority continue to seek human interaction in their transactions. Loyalty to brands is declining, but with varying intensity across different product categories, and private labels are gaining ground in consumer preferences.”

He adds: “Faced with this fragmented consumer audience, businesses will need to treat consumers as unique individuals with even more unique needs, which are often conflicting. They must therefore formulate multi-factor and personalised strategies to reach them. This is the central conclusion of our research, but it is particularly true for the festive season.

The market is in a festive mood – from 18 December the “Santa’s basket”

The market is now moving in a festive rhythm, with shops open daily with continuous opening hours, while they are also open today, Sunday, December 15 – as well as the next two Sundays, December 22 and 29 – so that consumers have more hours at their disposal to do market research and choose their gifts.

Every day the shops are open from 9 am to 9 pm and on Saturdays from 9 am to 6 pm and will be closed on Wednesday 25 and Thursday 26 December and Wednesday 1 January and Thursday 2 January.

In addition, as has been announced by the Ministry of Development, in order to facilitate consumers in the selection of gifts, from Wednesday, December 18, the “Santa Claus Basket” will be implemented again this year. As stated by Secretary General of Commerce and Consumer Protection Sotiris Anagnostopoulos, it concerns toys from both larger and smaller children’s goods and toy chains.

He added: “We will have 10 categories, which include almost anything a young or older consumer who would like to buy a toy, either for themselves or for a loved one, needs. There will be this opportunity from December 18 and it will last until after St. John’s Day, so there will be an opportunity for everyone to get a gift at affordable prices.”

For the festive table, consumers are reminded that they can choose from the “Christmas Basket” which is for basic consumer products. Namely lamb, goat, and turkey are added to the already existing items that make up the “Household Basket”, which includes pork, beef, and chicken. As explained by Mr. Anagnostopoulos: “‘So, we have the full range of meats available in the market, as well as we have in sweets, brioche, king’s cake and chocolate, which has shown some appreciation in recent times due to the increased international price of cocoa, but in any case we will try and consumers and we and, Obviously, those who are responsible for business, we will all try to have, as far as possible, better prices, so that vulnerable consumers, consumers who have a harder time than others, will find opportunities to have a decent holiday than last year.

On whether there are differences, compared to last year, in the products included in the “Christmas Basket”, Mr. Anagnostopoulos has said in statements to reporters: “The happy thing is that it is much better priced this year. The products are at about the same price and in some cases much cheaper. Especially when it comes to Turkey, we have bigger reductions there and that is positive (…). Regarding melomakarona and kourabiedes, they are not in the basket, precisely because supermarkets do not have a comparative advantage in terms of prices and quality. Here the advantage is rather in the confectioners and bakeries, so that is why these products are not included in the ‘Christmas basket’, but we urge consumers to trust local operators because they can offer very good quality and at very good prices. We also urge consumers to do careful market research so that they can avoid the exorbitant prices that can sometimes be found in the market, but with careful market research we can find very good prices and very good qualities.”

Source: pagenews.gr