Traders see profits, turnover dwindling to five-year lows

The profitability of small and medium-size enterprises (SMEs) has been eroded by 86 percent and their turnover has fallen by about half since 2009, fresh data from the National Confederation of Greek Commerce (ESEE) showed on Monday.

The report paints a bleak picture of the prospects of SMEs that are even worse than the projections made at the beginning of the year. Four in 10 businesses consider it likely they will be forced to shut in the near future.

The survey was conducted between March 14 and June 25 among a sample of 2,375 businesses. Average annual turnover declined by about 26 percent between 2009 and 2012, from 425,294 euros to 318,046 euros. Traders estimate this fell to 232,831 euros on an 12-month basis in June, which, if confirmed, would amount to a drop of 45 percent compared to 2009 and 26.7 percent lower than last year. The estimate represents a deterioration compared to projections made in January, when the average turnover for 2013 was seen at 267,840 euros.

In January, traders projected their average profitability at 7,090 euros for the whole of the year, but this fell to 6,925 euros in June, compared to an average of 49,212 euros in 2009. This drastic slide in turnover and profitability is having dire repercussions on the social insurance system and employment. Traders’ inability to keep paying social security contributions is threatening social insurance funds with collapse and the traders themselves with a loss of health cover. According to the survey, almost one in five are behind in their contributions.

Moreover, 15 percent of respondents believe they will have to reduce their staff in the immediate future while 74 percent think they won’t, but 42 percent see a shutdown likely in the near future and 25 very likely.