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| Commercial distribution. Radiography of the crisis. |
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| Thursday, 26 February 2009 | |
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Commercial distribution. Radiography of the crisis.
General decline in sales, closures of facilities, job destruction, increases in bad debt, recession in consumption, are some factors that coexist with the daily Spanish commercial network. Feeds the distribution of consumers. If they shrink their spending, the problems begin. This is what happened in 2008. The difficult situation facing the Spanish economy has moved into most sectors. In the case of retail trade is reflected in the difficulty many factors that end up passing each other, hindering recovery. Based on data provided by the Banco de España (BE) in its latest quarterly report on the state of the economy, household consumption fell from October to December in an interannual rate -1.5%, becoming the joint year in the factor that most contributed to the slowdown in GDP (-1.1% in the last quarter). Causes and consequences The causes of this contraction are spending, according to BE, distrust in the state of the world economy, the credit restrictions and the destruction of jobs. As a result, retail trade has closed the year with a general decline in sales as evidenced by data from the National Institute of Statistics. In real terms (price effect removed) the fall was -5.6%. Soaking up the worst part of the household segment with a cumulative fall in the year of -12.8%, while food has the lowest contraction (-2.5%). For formats, large chains have been the only model of distribution has increased its sales in the year 2008 (0.6%). Small suffer the greatest decline (-9.0%), followed by business unilocalizadas (-7.4%) and supermarkets (-5.8%). Result of decreased sales suffered by retailers and contraction of consumption have come out 1% of these (10,000 to 12,000 stores), according to estimates by the Spanish Confederation of Commerce. The closures have left the streets to between 30,000 and 40,000 workers. These figures represent the first negative balance of activity in the last eight years. Delinquency Another major problem faced by the current distribution is late payment. According to the latest data published by the INE for the month of November, the value of effects returned unpaid grew 79.2% in interannual rate, and reaches 1.979 million euros for 596,483 cases. The upward trend of late trading was launched in August 2006. In most cases the defaults are referring to the business of purchasing goods and services to the (television, travel, business machines) which involved a financial institution that advances the money. Although the increase in delinquencies that are living in such areas as retail trade is the main cause of economic crisis, the consulting firm specializing in Information Technology, Vanson Bourne, also says that due to the increased concern of retailers to reduce costs. According to a study made by it, 68% of retailers prioritize cutting operating costs compared to the increase in revenues and profits. The report also reveals that 36% of these companies fail to protect against the threat of debt and not review the history of late payments from customers, which in the opinion of the consultant makes them more vulnerable to defaults. Side effects The decline in sales has been reflected negatively on the industry of consumer goods while maintaining orders has reduced its billing. According to statistics from the INE, in the first eleven months of 2008, sales fell by -0.4%. The biggest decrease was experienced in the industry of durable consumer goods recorded a decrease of -12.6%. In contrast, for non-durable consumer goods increased by 1.6%. The signs are repeated to analyze the evolution of order entry. In this case the durable goods are reduced by 11.1% in interannual rate and non-durable goods rose 1.8%. Overall, from January to November 2008, the turnover of Spanish industry declined by -1.2% over the same period in 2007, and entry of orders fell by -2.1%. Solutions Seizing the opportunities of the crisis is the key to many economists and businessmen to leave such a negative. The distribution may not be aware of this possibility. The consultant's report proposes Deloitte Global Powers of Retailing smaller stores and more efficient (better targeted and more selected products); eliminate unprofitable; rethink your supply chain, training to vendors to improve their productivity, open to technology to not let the consumer on-line. Minister of Industry, Tourism and Trade, Miguel Sebastián, a bid to sensitize people to consume domestic products against imports. According to his calculations, if every citizen in your cart replaced products or services imported by the national value of 150 euros per year, avoiding the destruction of 120,000 jobs as a result of the fall in expected consumption for 2009. As we already have two years of large chains that have decided to turn around its sales strategy. The tree is competing via prices, guaranteeing the lowest in the market. A goal also pursued by the chain Mercadona valenciana. To achieve this has opted to reduce references (800) on the basis of rotation, and duplication needs. Distribution Update 25/02/2009 |
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