Su­per­mar­kets suf­fer fresh slump in turnover

Kathimerini English - - Front Page - BY DIMITRA MANIFAVA

The su­per­mar­ket sec­tor, whose de­cline in turnover dur­ing the sixyear re­ces­sion from 2008 to 2013 was rel­a­tively small, is now suf­fer­ing sig­nif­i­cant losses, af­fected by the coun­try’s financial hard­ship and the po­lit­i­cal un­cer­tainty that reigned at least up un­til last month’s elec­tions.

What is worse for the food re­tail sec­tor is that this new blow in 2015 came just as the mar­ket had started to look up last year. The de­cline in de­mand, com­bined with the cap­i­tal con­trols, which have strained re­la­tions be­tween re­tail­ers and sup­pli­ers, has al­ready had an im­pact on the sec­tor, with a num­ber of stores on the brink of shut­ting down, lay­offs threat­ened and a fur­ther con­cen­tra­tion on the hori­zon.

Ac­cord­ing to data from mar­ket re­searchers IRI, su­per­mar­ket turnover in the first eight months of the year posted a drop of 1.9 per­cent from the same pe­riod in 2014. A year ear­lier the mar­ket had sta­bi­lized (show­ing a mar­ginal 0.1 per­cent de­cline from the Jan­uary-Au­gust 2013 pe­riod), with the prospects for a re­turn to growth lead­ing all ma­jor play­ers to sig­nif­i­cant in­vest­ments, such as open­ing new stores and ac­qui­si­tions.

The de­cline in turnover is mainly a re­sult of shrink­ing de­mand and not a drop in prices. The IRI fig­ures show that sales vol­ume fell 1.1 per­cent while prices per vol­ume unit de­creased 0.8 per­cent on a yearly ba­sis. In to­tal, the value of sales fell 1.8 per­cent in 2014, but this was pri­mar­ily due to the 2.6 per­cent price drop per vol­ume unit. In con­trast, sales vol­ume had posted a year-on-year re­cov­ery of 0.8 per­cent as the econ­omy had started to re­bound in the sec­ond half of 2014. Even in 2013, a year that was in­deed dif­fi­cult, sales vol­ume had de­creased by just 0.1 per­cent.

In terms of turnover, Au­gust was the sec­ond-worst month for su­per­mar­kets this year, post­ing a 4 per­cent an­nual de­cline. This is at­trib­uted to the dra­matic shift in con­sumer be­hav­ior recorded af­ter the start of the 23-day bank hol­i­day, the in­tro­duc­tion of cap­i­tal con­trols and the wide­spread fear of a hair­cut on de­posits or even a Greek exit from the eu­ro­zone.

In other words, sales de­clined in Au­gust be­cause con­sumers had al­ready filled up their cup­boards and re­frig­er­a­tors in the runup to the July 5 ref­er­en­dum, just af­ter the gov­ern­ment closed the banks and im­posed the cap­i­tal con­trols. In that week, from June 28 to July 4, su­per­mar­ket sales soared, post­ing a huge an­nual rise of 37.6 per­cent. The fact that many peo­ple were shop­ping for the long haul was ev­i­dent in the cat­e­gories of food whose sales posted an in­crease in the first eight months of the year: Th­ese be­ing frozen food (up 6.3 per­cent) and stan­dard­ized food (up 4 per­cent).

In the weeks that fol­lowed the July ref­er­en­dum as well as the first cou­ple of weeks in Au­gust there was a con­sid­er­able de­cline in sales, rang­ing from 0.5 to 10.8 per­cent, de­pend­ing on cat­e­gory.

Re­searchers at­trib­uted the 2.9 per­cent drop in su­per­mar­ket turnover in the week from Au­gust 9 to 16 to a great ex­tent to the re­jec­tion by a large num­ber of SYRIZA deputies of the gov­ern­ment’s bailout agree­ment with its cred­i­tors, which also led to the breakup of SYRIZA and the Septem­ber 20 snap elec­tions.

Greek shipown­ers, the world’s lead­ers, saw their share of the global fleet ca­pac­ity grow last year to 16.1 per­cent, from 15.5 per­cent in 2013, ac­cord­ing to the an­nual sur­vey of the United Na­tions Con­fer­ence on Trade and De­vel­op­ment (UNCTAD). They owned 4,017 ves­sels to­tal­ing 279.4 mil­lion tons.

In the five weeks that fol­lowed the July ref­er­en­dum there was a con­sid­er­able de­cline in su­per­mar­ket sales, rang­ing from 0.5 to 10.8 per­cent.

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