Significant increase in EU retail sales due to rising prices
The retail sector in the 27 EU member states was again able to significantly increase its sales in 2022.
Last year, for example, around 2.83 trillion euros flowed into the retail sector, corresponding to a 6.5 percent increase in sales.
The highest gains were recorded by the Eastern European countries, all with growth rates of over 9 percent. At 23 percent, Slovakia is clearly in first place.
This is shown by the new Retail in Europe study, in which GfK examines important key indicators.
While retail sales in Eastern Europe increased significantly in 2022, a different picture emerged in Scandinavia:
Finland, for example, achieved a sales increase of only 3 percent, while in Sweden retail sales actually declined slightly by minus 1 percent.
A more detailed look at Fast Moving Consumer Goods (FMCG) shows that here, too, the Eastern European countries and, above all,
Slovakia are in the top ranks. Across the EU, the growth rate of daily consumer products was 6.9 percent, while in Slovakia sales grew by as much as 38 percent, many times more than non-food sales.
"First the Corona pandemic, then the war of aggression on Ukraine - European retail is experiencing one crisis after another," explains study director Dr. Philipp Willroth.
"Despite this, the retail sector recorded a significant increase in sales in 2022. This is mainly due to increased consumer prices, especially for food and in the FMCG sector in general.
However, people in Europe remain unsettled due to high inflation and the war in Ukraine, as well as the associated economic consequences, and tend to be more frugal with their money."
In the free "Retail Europe" study, GfK's Geomarketing division examined the key indicators for European retail in 2022. The study offers comprehensive trend analyses
for numerous European countries and is thus an important orientation aid for retailers, investors and project developers.
Other key findings at a glance
Purchasing power: Following almost unchanged purchasing power in 2020 compared with the previous year and moderate purchasing power growth of 3.9 percent in 2021,
net disposable income in the European Union rose significantly more strongly again in 2022. Across the EU, per capita purchasing power averaged EUR 18,468, representing a nominal increase of 6.1 percent.
Share of retail sales in private consumption: Although retail sales grew significantly in 2022, the share of retail in private consumer spending recorded a decline
for the first time in years. Despite a return of shopping enthusiasm and more tourists, retail consumption was dampened above all by high inflation and high energy prices.
As a result, the share of retail sales in private consumption in the 27 EU countries fell by 4.6 percent to 34.2 percent. Hungary, a country particularly affected by inflation and rising prices,
had the largest retail share of consumption at 49 percent, followed by Bulgaria and Croatia at 47 percent each.
Inflation: After inflation in the 27 EU countries reached a record level of 9.2 percent in 2022, an inflation rate of 6.7 percent is forecast for 2023.
However, this will be offset by an expected wage increase of 5.9 percent, which will not fully compensate for the loss of purchasing power caused by inflation.
At 16.4 percent, price increases will be particularly strong in Hungary, but double-digit growth in consumer prices is also expected in the Czech Republic, Poland and Slovakia.
Development of inflation by purchasing power categories: Consumers in regions with low purchasing power have to allocate a larger share of their budgets
to FMCG spending. For example, consumers in Romania and Hungary faced price increases of 22.8 percent and 37.8 percent, respectively, for FMCG,
while the Swiss had a very moderate price increase of 4.1 percent (January 2022 to April 2023), not least due to a special path with import taxes.
The PDF study is available free of charge in German at http://www.gfk-geomarketing.de/handel-europa and in English at www.gfk-geomarketing.com/european-retail.