According to the German Trade Association (HDE), the federal election on February 23rd could bring the industry the long-awaited boost.
“The federal election can act like a champagne cork,” said HDE President Alexander von Preen to the German Press Agency. “If we have framework conditions again where people say: ‘Yes, now things are going in one direction, now we can see where we want to go’, then that will be a totally liberating situation and bring a lot of dynamism to the market.”
Reliability and stability are needed again in Germany – and therefore a clear decision on direction. However, according to the HDE boss, a long stalemate after the election would be poisonous for business: “I have great hope that everyone has understood that we cannot allow ourselves to form a government for a long time,” said von Preen. There is nothing worse for trading than uncertainty. “Then nobody buys, then nobody invests, and then the entire system is disrupted to a certain extent.”
Dealing with problems
2024 was difficult again for trading. The hoped-for upswing failed to materialize. The trade association had initially forecast a nominal sales increase of 3.5 percent. In the fall, however, the annual forecast had to be revised significantly downwards. The HDE recently expected a nominal sales increase of 1.3 percent to 657 billion euros. Adjusted for the increased prices, this corresponds to zero growth compared to the previous year. Many retailers were also not satisfied with the Christmas business.
The reason: Many people save instead of consuming extensively. And this despite the fact that inflation has weakened recently. However, the increased and perceived high prices, wars and economic uncertainty continue to depress sentiment and the mood to buy.
This also has consequences for city centers: While Asian shopping portals like Temu are growing rapidly, the situation for many established companies is difficult. Some have recently thinned out their branch network or closed all stores – also as a result of bankruptcies. Other companies are now pushing into the city centers. According to HDE, the number of retail stores has fallen from 372,000 to 306,000 since 2015. The association expected around 5,000 closures in 2024. There is still no estimate for 2025. (dpa)