Retailers see decline in turnovers

Retailers see decline in turnovers

Retailers see decline in turnovers

Retailers in Turkey made a rather weak start into 2022 as their businesses declined in January more than usual.

Turnovers of retailers fell by 20 percent in the first month of this year compared with December 2021, according to a survey the United Brands’ Association (BMD) conducted among member companies.

Historically, turnovers in January would be 10 percent lower from December, but this year the decline was deeper, said Sinan Öncel, head of the BMD, noting that revenues from e-commerce operations also dropped but not as much as they did at brick-and-mortar stores.

“We assess that there are two main reasons for the more than expected decline in turnovers: First, people probably postponed shopping because they received pay rises in February and, secondly the harsh weather conditions, particularly in Istanbul,” Öncel said.

Turnovers in the first half of this month were not at desired levels either, according to Öncel.

He complained that companies were already struggling with high raw material and freight costs and that came on top of those the rise in electricity prices. “It is very difficult for companies to cope with those challenges going forward with revenues at their current levels.”

Öncel predicted that consumers may cut down on non-food expenditures in the months ahead.

“Our expectations, on the other hand, are running high when it comes to international shoppers. The revival in tourism activity is likely to boost retailers’ turnovers after March,” he said.

Shopping volume with international cards, which amounted to 150 billion Turkish Liras in 2021, is forecast to increase to 250 billion liras this year, Öncel added.

The Turkish Statistical Institute (TÜİK) reported last week that the combined turnover in the industry, trade and services sectors increased by 82.4 percent in December 2021 on an annual basis.

In the trade industry, the rise in turnover was nearly 77 percent, while services companies saw their turnovers increase by 83 percent.