Retail losses seen at over 50%
Retail commerce is expected to lose more than 50% of its annual turnover this year, as the November lockdown that went into effect on Saturday finds the market already damaged by the spring’s forced closure, while households have less money and are under significantly more pressure.
Estimates of a turnover loss of just over 50% are actually considered quite moderate, as many market observers fear that the restrictions will not be lifted on December 1, or will only be lifted partially, preventing the market from regaining its usual pre-Christmas conditions. This was also implied by Prime Minister Kyriakos Mitsotakis in his statements last Thursday.
The second suspension of operation for brick-and-mortar stores will not only hurt smaller but also bigger enterprises. This is because the latter have invested significant amounts of money in the infrastructures required for the faster processing of online orders, but in no way can they offset the losses at this stage, with the economy diving deeper into recession.
“The blow from the second lockdown will be crushing for retail commerce. The recent estimates by merchants in the surveys of the Commerce and Services Institute of the Hellenic Confederation of Commerce and Entrepreneurship [INEMY ESEE] about an annual drop in turnover by 50% will need to be revised again for the worse, although any forecasts at this stage are risky,” ESEE President Giorgos Karanikas told Kathimerini.
“Last April, in the first full month of the first lockdown, retail turnover dropped by 25% in total. That decline would have been far steeper had it not been for increased sales by supermarkets and pharmacies,” added Karanikas.
“However, this second bout with the pandemic will be even longer and more difficult, as the coronavirus will increase the fatigue of the state, of the citizens and of enterprises,” he warned.
“Let’s be realistic: The impact is very negative. The lockdown amounts to losses of more than 5 billion euros per month for the gross domestic product,” said Giorgos Alevizos, chief financial officer at the Fourlis group.
