Christmas sales poor, say German retailers

Retailers in Germany have reported sluggish Christmas sales, with a decline in volume compared to last year and a notable fall in real terms due to the impact of rising inflation.

According to a survey by German Retail Association, Handelsverband Deutschland, or HDE, approximately 60 percent of 350 retail companies expressed dissatisfaction with the sales trend, reported Deutsche Welle News.

The second week of the advent religious season leading up to Christmas was noticeably weaker in the retail sector than the first, it said.

"Many retailers are now pinning their hopes on the final spurt before the festive season," said Stefan Genth, HDE's managing director.

City retailers have reported a decline in the number of store visitors, as two-thirds have witnessed a decrease in the number of customers compared to the previous year, said HDE.

It estimated that Christmas business, in November and December, would generate sales totaling just over 120 billion euros ($129 billion).

Despite a 1.5-percent increase in sales, the volume of sales this year is effectively lower compared to the previous year, it said.

"Overall, only 15 percent of the retailers surveyed are satisfied with how the Christmas business has gone so far," the HDE report said.

The survey indicated that retailers have "muted expectations" for the coming weeks, with just under a fifth anticipating a positive development.

The HDE managing director expressed a less pessimistic view, noting that the approaching holidays in the second half of December typically generate additional momentum for sales.

"If the festive mood increases in the near future, it can noticeably boost Christmas business," said Genth.

According to a survey conducted by the Ifo economic institute, German retailers do not anticipate a significant surge in Christmas sales this year due to the persistently weak demand weighing heavily on their business.

The Ifo survey, published last week, showed sentiment among retailers experienced a positive shift in November, marking the first improvement in three months, with a rise from-13.5 in October to-8.8 points, reported Reuters.

"Despite the slightly improved mood among retailers, demand, which has been weak all year, remains a challenge even in the period of strong sales during the run-up to Christmas," said Ifo retail expert Patrick Hoeppner.

According to Ifo, expectations within the sector for the coming months continue to be pessimistic.

It said easing inflation could provide new momentum for retailers next year. "As with the economy as a whole, price increases in the retail sector are likely to continue to weaken in the coming months," said Hoeppner.