Association: Christmas sales are a fiasco for retailers

Prague, Jan 22 (CTK) - Sales of large retailers dropped by roughly 4 percent year on year in December and even Christmas did not help despite the fact that it is the strongest period of time for retail chains, Zdenek Juracka, president of the Association of Trade and Tourism (SOCR), told journalists Tuesday.

Retail chains which were opening new outlets were the only exception as their turnover grew moderately. Retailers expect the situation on the market to improve this year.

Czech retail sales fell by 1.8 percent yr/yr in November and the overall decrease did not stop in December, traditionally the strongest month for retailers.

People were postponing Christmas shopping till the last moment and a large part of them even waited for post-Christmas sales. Shops registered the highest growth in sales on December 21 to 23.

According to first estimates, retail sales decreased by 2 percent last year but retailers hope for better development this year.

"The end of the year did not compensate the losses that retail trade had to grapple with for the whole year but everything indicates that people are willing to buy. It can thus be supposed that if the government had not delayed its decision on the VAT size for such a long time, a turnaround for the better could have come a month or two earlier," Juracka said.

Retailers are optimistic and despite the increase in taxes, they think the markets will get stabilised this year and sales will grow moderately.

Global retail sales grew by 5.6 percent in 2012 but retail sales figures differed a lot in individual countries. The fall in sales in some countries of western and eastern Europe was widely compensated by the growth in retail sales in China, India and Latin America.

As much as 40 percent of fast-turning goods in retail chains in the Czech Republic are sold in special rebate offers, Martin Ditmar, head of retail chain Interspar, has said.

Goods sold with rebate are increasingly more popular among Czechs. "There are clients who buy only goods sold with special rebate. I call this the road to hell," said Juracka, who is also head of sales at consumer cooperative COOP.

Sales of goods sold in special offers at a much lower price than usual are close to 50 percent in the Czech Republic.

"This causes us big problems. In the neighbouring countries, the share stands at 20 percent," Ditmar added.

Juracka noted that some companies would probably be unable to resist the pressure on prices and leave the market.