Eurobank: The effects of pandemic and inflation on retail trade are evident

Pandemic and energy disruptions continue to affect the development of retail sales , according to the newest issue of Eurobank ‘s 7 Economy Days’. During the debt crisis and the period of stagnation that succeeded it, the retail volume index shrunk overall by 41.2% reflecting the large decrease in available household income. In the first year of the pandemic (2020) due to social detachment measures the volume of goods sold in retail trade shrunk by 4.0%, with the largest reductions recorded in car fuel and lubricants (-13.3%, due to the ban on movements) and clothing – footwear (-21.7%, due to the sharp increase in residence time for household members in their homes). On the contrary, the needs created by the pandemic for the consumption of pharmaceutical goods and for the focus of household members in their homes led to an increase in sales in pharmaceutical- cosmetics and large food stores (super markets) by 17.4% and 5.2% respectively. In the two years 2021-2022 the opening of economic-social activities alongside extensive financial support measures led to an increase in the retail volume index (average annual rate of change of 6.7%). The categories of shops of books-paper-other-species, furniture-electrical-domestic equipment, clothing-skinning and pharmaceutical- cosmetics recorded the highest average annual increases with 16.6%, 16.3%, 15.5% and 14.3% respectively. In 2023 due to the late effects of high inflation and post-pandemic demand slowing, retail sales volume decreased by 3.3%. Shop categories that fell in their sales volume were the large food stores (super markets, 3.1%), car fuels and lubricants (1.1%), pharmaceutical- cosmetics (3.5%) and marginally paper-other species (0.5%). Compared to pre-pandemic levels the volume of goods sold in retail trade in 2023 was boosted by 5.6%, with the categories of stores of pharmaceutical- cosmetics, furniture-electrical-domestic equipment and books-chart-other items showing the highest cumulative increases of 47.6%, 33.3% and 29.2%. These results are linked to a degree to the late-term effects of the pandemic, to the increase in investment in housing and to the needs of the digitisation of the economy (the category of books-paper-other items includes computers and telecommunications equipment). Finally, in the 4 years 2020-2023, the highest differences between the value of retail sales at current prices and the volume of goods sold are presented by the categories of large food stores (28.6% vs 1.5%), fuel and lubricant cars (7.2% vs -9,8%) and food-drink-smoking (27.4% vs 2.3%). Especially in large food stores, in 2023 for the second year in the series the volume of goods sold decreases, while the value of sales at current prices increases.