Economy & Finance

Euro zone crisis batters holiday sales prospects

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LONDON (Reuters) – Shoppers in euro zone nations battered by years of recession and crisis are on the hunt for bargains, delaying their purchases until the last minute, or simply not buying at all as post-Christmas sales get underway.

Britain and Sweden appeared to buck the trend, however, with the number of people visiting shops on Wednesday, the day when clearance sales traditionally start, well up on last year and sales volumes high.

In southern Europe, where the economic crisis has hit hardest, sales were down, in some cases quite substantially, according to an informal Reuters survey.

In Greece, whose economy has been shrinking for five years, retail turnover in December is expected to have fallen by about one fifth compared to a year ago, according to Vassilis Korkidis, chairman of the country’s retail trade association.

“Unfortunately, yet another year has been marked by poor Christmas sales. I hope that 2013 will put an end to the economic war we have been fighting for five straight years now,” Korkidis told a Greek television station.

Athens’ main shopping streets were buzzing with people before Christmas. But many shopkeepers complained that families merely came for a walk to enjoy the warm, sunny weather.


Spain’s biggest department store, El Corte Ingles, has not officially started its winter sales, but is already offering discounts on selected items such as flat-screen televisions.

Shopkeepers were expected to offer big reductions when clearance sales officially start next month in an attempt to generate some interest from customers after two straight years of falling retail sales.

“The Christmas campaign didn’t take off the way it was expected to and we know sales are down compared to 2011 though we don’t have the figures yet,” said Ainhoa Garcia, spokeswoman for the Spanish Commerce Confederation.

For Italy, another victim of the euro zone crisis, this Christmas will go down as “the worst in the last 10 years”, according to the Codacons consumer organization, with spending down by as much as 20 percent compared with a year ago.

Italian families were buying fewer and cheaper presents and even recycling last year’s Christmas decorations.

An exception to the downturn was spending on food, which rose 5 percent as Italians remained reluctant to give up on elaborate Christmas meals.

In France, a special promotion by supermarket group Intermarche resulted in the sale of 45,000 tins of caviar, three times more than last year.

But with a month of winter sales beginning on January 9, the outlook is less rosy. Only 48 percent of shoppers are planning to participate, according to a poll by market research firm Harris Interactive.

In relatively prosperous Germany, the outlook was better. Shoppers had waited until the last minute before making their purchases, but a sharp pickup in the week before Christmas was expected to continue into the New Year, the German retail association said.


“More and more often, Christmas presents are being bought only just before Christmas,” said Stefan Genth, head of the HDE retail association, which represents 100,000 members.

Revenues from Christmas shopping are expected to amount to about 80.4 billion euros, an increase of 1.5 percent from the year-earlier period, HDE said.

“We expect sales momentum to continue between Christmas and New Year,” HDE spokesman Stefan Hertel said.

Post-Christmas clearance sales in Britain appeared to get off to a strong start, as cash-strapped shoppers rushed to grab bargains.

Initial reports indicated footfall had risen over 20 percent across the country on Boxing Day, the day after Christmas and the traditional start for clearance sales.

More retailers than ever before had begun sales on Boxing Day to maximize the time they were open for shoppers, said a spokesman for the British Retail Consortium.

“Customers are extremely savvy, even more so in these difficult conditions,” he said.

Leading British department store chains like Marks & Spencer (MKS.L ), Debenhams (DEB.L ) and John Lewis JLPLC.UL began clearance sales online on Christmas Eve.

John Lewis said online sales in the first hour were up 70 percent on 2011, while sales on Christmas Day rose 40 percent.

Gisela Bruem-Cedergren, sales chief at department store Ahlens City in Stockholm, said turnover and number of visitors on the first day of post-Christmas sales hit record highs.

“We hit a record, the day’s total turnover was our best ever for a Boxing day,” she said in the Swedish capital.

“When we opened, customers ran straight to the perfume department near the entrance, grabbing bottles at random so they flew all over the place,” she said. “We were a bit shocked.”

(Reporting by Rosalba O’Brien and natalie Huet in London, Edward Taylor in Frankfurt, Dominique Vidalon in Paris, Danilo Masoni in Milan, Harry Papachristou in Athens, Clare Kane in Madrid and Anna Ringstrom in Stockholm- Editing by Erica Billingham)

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