Greek commerce is going through lean times. The situation is due to get even worse as serious, even painful, changes are expected up to 2004. Beyond the threat of recession and structural problems, the sector is coming face to face with the consequences of poor decisions taken at the height of the stock market boom. One example is Connection, which is affecting a number of merchants who dealt with the company. Market observers said this is not the first, nor will it be the last, instance. «Because of the stock market bubble, we may see more cases like this in the immediate future,» said Christos Folias, head of the National Confederation of Hellenic Commerce. «(In) this specific case… the Capital Market Commission allowed this tragic incident to happen, either because of its self-interest, superficiality or incompetence.» During the good times, there were a number of companies that expanded into related sectors and unknown markets based on expectations of their financial growth. Either they ignored or did not pay attention to indications coming from other European countries where major companies were starting to retrench or were on the brink of collapse. Luc Valdevelde, president and managing director of Marks & Spencer, outlined to Kathimerini the reasons why the company fell into such dire straits. «It was so rich that the company decided to make investment decisions believing that it could grow in areas that were not core to its operations. Those decisions, however, did not produce results.» Antonis Makris, head of the Confederation of Retail Sales Enterprises of Greece (SELPE), said the present conditions required a readjustment of strategy even if this proves to be painful. «The majority of companies have started to rationalize their operations in order to secure economies of scale. I believe this year and next will be critical for the Greek commerce industry. I estimate a lot of shops will close if they do not meet expectations. The next phase will see the emergence of stronger businesses.» Until recently, retailers found it difficult to close down lossmaking shops, as they believed this would hurt the company’s image. Small networks or single shops were the main victims, especially in the 1990s. «The chief sign of the sector’s decline is not the number of shops closing down but the balance between those opening up and those closing down,» said Folias, meaning that while more shops were opening than closing in the 1990s, the opposite holds true now.