Turnover of organized retailers increased as much as 80 percent last year in line with inflation, but their unit sales declined compared to 2022, according to Sinan Öncel, the president of the United Brands’ Association (BMD).
Some 57 percent of retailers said their turnover rose by 80 percent or more in 2023, Öncel told reporters, unveiling the results of a survey conducted among its member companies.
“However, some member companies reported lower unit sales last year compared to 2022.Around 37 percent of the respondents said unit sales fell from the previous year. This is a significance ratio.”
The purchasing power of domestic customers eroded in the last quarter, while Türkiye became less appealing to foreign shoppers in the final quarter of 2023, Öncel said.
“We think the combination of those factors was the reason for the decline in unit sales. The data from the Interbank Card Center (BKM) support our assessment regarding sales to foreign consumers,” he added.
The share of foreigners in total card expenditures in 2022 was around 10 percent, while it declined to 6.5 percent last year, Öncel explained.
Sales may increase in the coming two to three months due to the hikes in the minimum wages, civil servants’ wages and pensions, according to Öncel.
“However, if inflation cannot be brought under control, we are concerned that people’s purchasing power will erode further starting from the second quarter of this year,” he said, noting that measures designed to combat inflation mostly aim at curbing domestic demand.
“We need to find other ways to fight inflation without depressing domestic consumption.”
The debt in the retail sector stood at 465 billion Turkish Liras, or around $15 billion, as of January, according to the numbers from the Banking Regulation and Supervision Agency (BDDK), Öncel said.
“If the retail industry contracts, stores will close and employment will decline,” he added.
Source: hurriyetdailynews