The movement in January, the first month of sales, is characterized by the commercial world as sluggish, with the market continuing to be faced with the limitation of disposable income for the majority of Greek households. Retailers may have kicked off the sale season with big deals on their products, but consumers made smaller purchases as staples take up most of their income.

As the president of EVEP & PESA reported to APE-MBE, Vassilis Korkidis “the first month of the sale was spent with an eye on precision food and with buying traffic in the rest of the retail trade moving in January with an inflationary rise in turnover. The “discounts manual” showed once again that the first weeks of the sales and until the end of January were more intense in terms of purchasing interest and traffic with first preference for branded products. Although the percentages of discounts range from high levels of 40%-50% for the majority of goods, less value purchases were nevertheless made, as the difficulty in household finances led to cuts in essential and lower value goods. A lot of people went through the shops of Attica in total, but the shops that opened on Sundays in January did not have the expected sales”.

According to Mr. Korkidis, the new landscape that has begun to take shape in retail trade over the last two years in consumer credit is worth mentioning, changing the way households borrow to meet their personal and family needs. “The competition game is rapidly moving from the credit institutions to the real market arena, i.e. the retail businesses, which offer products and services online or through their physical stores. In this case, according to him, the credit is provided at the time of the transaction, after the consumer has decided what to buy with the “buy now, pay later” method. At the cash desk, electronic or physical, he is given the option, instead of a one-time payment, to pay the amount in interest-bearing or interest-free installments. The credit is provided by a bank and approved at the same time to complete the payment to the business. “So after the “battle of discounts”, banking sources are talking about the “battle of installments”, which is expected to intensify in the coming years and extend to all retail branches. The purchase of a TV, a garment, a car, even the cost of a visit to the dentist or the servicing of a vehicle can now be done with payment facilities. And this without the consumer having a credit card or having to take out a loan, but in the form of a “digital notebook”, Mr. Korkidis emphasizes to APE-MPE.

Sales are at a low level

In particular, in the Piraeus region, according to the research of the Piraeus Chamber of Commerce, sales of winter sales moved in January at a lower level, compared to last year’s period, for the majority of small shops. In detail, 6 out of 10 commercial enterprises moved downwards with the majority recording a decrease of up to 20%. At the same levels as the previous year, it moved for 2 out of 10 companies, while 2 out of 10 moved up, even at a low percentage. “The expectations of the majority of businesses for the course of sales in the next period are moderate, since they do not foresee a significant upward trend in turnover in the month of February. The market will continue in February to be faced with the limitation of the income available for consumption for the majority of Greek households, but it is comforting that the economic climate in our country is moving with a positive sign. Last year’s target for a turnover of more than 6 billion euros in the first two months of the year is certain to be achieved and in fact, mainly due to inflation, it will increase” Mr. Korkidis points out speaking to APE-MPE.

“It is not a psychological factor that slows down sales,” notes the Athenian-Macedonian News Agency. Makis Savvidis, vice-president of the Athens Chamber of Commerce and vice-president of GRECA and adds: “it clearly has to do with the limited disposable income of consumers which is directed mainly to the purchase of basic goods”.

According to Mr. Savvidis, the purchasing movement during the first month of the sales was sluggish, while the picture was the same during the two previous Sundays (January 14 and 21) when the market was open. “Merchants early on started with big offers on products in order to attract consumers but also to liquidate their available stock. However, consumers have been restrained in their purchases because there is no disposable income. For the next period, and specifically until the end of February, we do not expect any significant changes in the consumer climate. The situation has made it difficult for disposable income, after the big rise in prices of basic necessities and the big rise in rents.

Asked about the measures taken by the government to combat punctuality, Mr. Savvidis emphasizes that they are moving in the right direction. “It is very positive that the market is controlled. The Athens Chamber of Commerce was the first to express its concern since the beginning of last year when inflation began to increase excessively above the EU average. From May to September, due to the pre-election period, the situation was left and now checks are made in a consolidated state. Checks should be done every day on the entire market. They must also be institutionalized, not based on the disposition of each minister and each government. They are in the right direction and should be continued and intensified. After all, this is the role of the state. To control the market”.

The major changes in consumer behavior, due to inflationary pressures, is demonstrated by research carried out by the Consumer Goods Retail Research Institute (IELKA), with a sample of 1,000 consumers in November 2023. In particular, the tendency of consumers to save money for the purchase of basic goods and services and secondarily money management is clear. In fact, there is greater pressure to reduce spending on basic services and less on basic goods.

More specifically, 75% (against 71% in January 2023) of the public declares that they have canceled entertainment expenses such as catering, vacations, trips, etc. 52% (up from 50% in January) of the public say they have postponed maintenance and repair work, e.g. at home or in the car. 55% (vs. 55% in January) say they have cut back on food and grocery shopping overall. 48% (compared to 40% in January) say they have switched product brands. 28% (compared to 24% in January) say they have used money from their savings to cover their purchases. 28% (against 29% in January) have postponed paying bills or stopped paying their obligations. 15% (compared to 11% in January) say they have increased their working hours or found a second job in order to increase their income. Just 4% of the public say they have taken no action at all to address inflationary pressures.

Regarding the state’s measures to deal with punctuality, one year after its implementation, the household basket presents a positive picture. Its use by the consumer audience has increased, from 28% to 61%, while the audience that considers it offers nothing has decreased from 44% to 29%.

According to the survey, the household basket ranks last in terms of measures that consumers themselves consider would help them deal with accuracy at just 3%. The main measure desired by consumers is by far the reduction of VAT on basic foods by 81%, followed by products with a permanent price commitment by 10% and the market pass by 6%.