Number of retail units to drop further in Hungary this year
The number of retail stores in Hungary dropped below 120,000 last year, with 2,300 units closing last year even as consumption continued to drive economic growth, according to data released by the Central Statistical Office (KSH) in May.
We are now quite far from the 150,000 stores Hungary used to have before the global crisis, and the unfavourable trend may be set to continue. According to a fresh report on the early experiences of the coronavirus pandemic by commerce portal Blokkk.com, the number of stores could decrease even faster this year.
The number of food stores decreased by 850 last year to 38,140, while the number of non-food stores dropped by 1,450 to 79,100. Many of the closing retail units were selling clothing and footwear or manufactured goods, but there are also fewer newsstands now than a year earlier.
In April, retail trade was unsurprisingly 10.2% lower than a year earlier according to the KSH. Sales in food stores barely decreased and were practically stagnating, while non-food stores and fuel sales fell sharply.
There has been some improvement in May based on data from online registers (the KSH has yet to release May figures), although all segments except food and mixed retail decreased in volume year on year.
Retail stores were hit hard as the government imposed shorter opening hours on most non-food stores from 16 March before introducing lockdown measures, but the world has not been the same even after the restrictions were lifted. “Customers remain very cautious, as news of the pandemic and the associated risks are presumably still on their mind,” Blokkk.com said.
A number of retail stores have not been able to reopen (meaning owners have costs but no revenue), while others will be in a tight spot due to lower sales in coming months. According to Blokkk.com, households will remain cautious for several months and will only buy essential things, postponing high-value purchases. If there is no second wave of the pandemic, the last quarter could bring a marked improvement.
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