High inflation is putting a strain on consumers in Germany. Retail is clearly feeling this.
Germany’s retailers sold less last year after adjusting for prices. In real terms, revenue fell by 3.3 percent compared to the previous year, as the Federal Statistical Office in Wiesbaden announced based on preliminary data.
The result was slightly worse than the authority’s first estimate of minus 3.1 percent. However, sales were still 1.3 percent above the pre-Corona level in 2019. Including price increases (nominal), retailers had 2.3 percent more in their coffers than in 2022.
Real sales in food retail fell by 3.9 percent in 2023 compared to the previous year. Since the corona-related record growth of 5.4 percent in 2020, price-adjusted revenues have fallen continuously in the following three years, the statisticians explained. Including the sharp rise in food prices, grocers recorded a strong increase of 5.9 percent.
Sales are also falling in online trading
In the internet and mail order trade, which boomed during the corona pandemic, sales fell by 3.9 percent in real terms and by 0.4 percent in nominal terms. The retail trade in textiles, clothing, shoes and leather goods continued its recovery after the slump during the pandemic and generated 2.6 percent more in real and 3.7 percent in nominal terms than in the previous year.
According to preliminary results, retail sales in the important Christmas business in December were 1.7 percent less in real terms than in the same month last year. In nominal terms, it recorded a slight increase of 0.8 percent.
Higher inflation rates reduce the purchasing power of consumers, who can afford one euro less. Many people therefore slowed down on consumption last year.
Source: Stern
