Consumers cut down on goods seen as inflexible

It appears that the winter sales were unable to rekindle consumer interest in making purchases in February, as Hellenic Statistical Authority (ELSTAT) data for the month show that Greeks are prepared to cut down even on vital goods such such as food, medicines and fuel due to the drastic cut in disposable income.

All commodity categories posted a decline in February compared to the same month in 2012. Apparel sales however declined by less than 10 percent, outperforming other categories, although this was probably because some consumers tried to make the most of the lower prices for clothing and footwear.

ELSTAT data revealed a 14.4 percent drop in retail turnover on annual basis, against an 11 percent decline in February 2012 compared with 12 months earlier. The volume index is showing the biggest yearly drop at fuel stations, supermarkets and pharmacies, as the last two categories appear to be losing their capacity to resist the crisis as had largely been the case in the first three years that the austerity measures were imposed in Greece.

Sales at gas stations posted a 17.4 percent decline, mostly because of the considerable drop in the number of Greeks using private vehicles due to the high cost of fuel. Pharmacies saw a 17.5 percent fall in turnover, which is not so much attributed to the decline in the prices of drugs but rather to the shrinking of sales of cosmetics.

More surprising was the 15.2 percent year-on-year slide in the sales volume at supermarkets, amounting to 14.6 percent in February, growing to 15.2 percent if the January sales are also included. Similarly, smaller food stores reported a 12.4 percent annual drop in February. It appears that demand for food is more flexible than originally thought, which could have serious social repercussions.

The decrease was comparatively smaller at stationery stores (11.4 percent) and shops selling furniture, electrical goods and homeware commodities (10.2 percent), likely due to having already declined considerably in 2011 and 2012.

Apparel retailers reported a yearly slump of just 4.7 percent as the whole of February was inside the frame of the winter sales window. In other months the drop in turnover had been twice the market average. That may well also be the reason for the smaller drop in department stores, too, which came to 2.5 percent year-on-year.