The withdrawal of entrepreneur René Benko from large inner-city projects with “flagship character” could worsen the crisis in stationary retail and have serious consequences for inner cities.
This is the conclusion of a report by the credit agency Creditreform, which was published in Neuss on Wednesday. Many of the Benko projects are in danger of “becoming building ruins”, meaning that the affected inner cities and urban districts are “losing more of the revitalizing elements than the pure sales area,” said Patrik-Ludwig Hantzsch, head of Creditreform economic research.
Stationary retail is currently struggling with various challenges, including declining market shares. According to the Federal Statistical Office, sales of clothing increased by a good nine percent in the first half of 2023. According to Creditreform, stationary fashion retailers benefit little from this. Of the total of almost 70 billion euros in fashion sales in Germany in 2022, around 40 billion or almost 60 percent were bypassed by specialist retailers in favor of other sales channels.
“The retail industry is under enormous pressure to transform due to changing consumer habits, massive cost increases for rents in exposed city center locations and, last but not least, personnel and energy costs,” said Hantzsch. This is also due to the fact that many stationary retailers are still having difficulty converting to online sales. According to the German Trade Association (HDE), only eleven percent of sales were generated online in 2022.
As an example of the difficult situation in the fashion retail sector, Creditreform points to the bankruptcies of Peek & Cloppenburg, Gerry Weber and other large and small fashion houses. Creditreform expects the number to increase. The loss of attractiveness of stationary specialist retailers has recently been accelerated by the pandemic, war and recession, but it began long before that. Between 2008 and 2014, the number of visitors to stationary retail fell by a third, while the importance of e-commerce increased.
However, according to the report, there is also an opportunity in the difficult situation. “On the one hand, shop rents are falling, and on the other hand, where new living space is being built, more people are in the city, which increases the number of potential customers for the retail trade,” says Hantzsch. “If your favorite boutique is within walking distance of your apartment, the supposed advantage of online trading no longer applies.”(dpa)