SME retail sales fell 7.3% annually in April and have accumulated a drop of 18.4% in the first four months of the year. Compared to March, they rose 1.6%, according to the Argentine Confederation of Medium Enterprises (CAME).
The rebound compared to the drop in March (12.6% year-on-year and 3.2% month-on-month) was related to the return of interest-free installments in some stores selling household appliances and construction materials, above all, which helped improve the sales
However, in April, six of the seven items recorded year-on-year falls. The greatest annual contraction was detected in Perfumeries (-23.3%) and the only increase was in Textiles and clothing (+8.8%).
“Retail trade continues to feel the decreasing dynamics of the purchasing power of consumers, who have cut spending in all areas. The only sector that emerged from this trend is clothing and textiles, favored for three reasons: due to the proliferation of offers; due to the very low base of comparison, since the industry has been very weakened since the pandemic; and due to the slowdown in prices in this particular item,” CAME said.
Food and drinks
Sales fell 8.5% annually in April and accumulate a drop of 23.8% in the first four months of the year compared to the same period in 2023. In the month-on-month comparison, they rose 2.7%.
“Businesses in large cities consulted indicated that in April sales were lost in the hands of hypermarkets, which attracted the public with some very aggressive discounts. In neighborhood stores, the greatest demand was focused on alternative brands, seeking to make the food basket cheaper,” the entity said in its report.
In this framework, according to LCG, food and beverage prices fell 1% in the last week of April. The consulting firm recorded that there was a drop in prices in practically all areas of foods and beverages with the exception of dairy products. Fruits, for example, had a nominal price decline of 6.8% in the last week of the month. Condiments and other food products dropped 3.1%followed by Sugar, honey, sweets and cocoa (-2.9%), Vegetables (-2.4%), Drinks and infusions to consume at home (-1.8%), Meals ready to go (-1.4%), Baked goods, pastas and cereals (-0.7%), Meats (-0.5%) and Oils (-0.3 percent). Dairy rose 1.9 percent.
Bazaar, decoration, home textiles and furniture
The decline in the item during April was 9.4% annually, which brought the fall for the quarter to 17.6%, compared to the same period last year. In comparison with March they fell 1.6%. “Sales were very slow, with empty stores and purchases more linked to making a gift. The measured businesses highlighted that what came out the most were inexpensive decoration products and winter textiles, such as quilts and fleece blankets. A consensus view was that, for current sales levels, fixed costs are too high,” the report noted.
Footwear and leather goods
Sales had a decrease of 2.4% and accumulated a decline of 12.5% in the first quarter. In the month-on-month comparison they rose 2.6%.
“The change of season did not favor footwear because prices are higher, but the category cushioned the fall with the liquidation of items from previous seasons and the Simple Fee program offered by some stores. The sale of informal footwear, especially sneakers, was better than that of formal footwear,” CAME indicated.
Textile and clothing
The textile and clothing category was the only one that registered an increase with an increase of 8.8% annually in April, accumulating an increase of 5.9% in the first four months of the year compared to the same period in 2023. In the comparison month-on-month they also rose 1.4%.
“Everything that is on sale, what has quotas or discounts, is sold. The stores surveyed indicated that they continue to sell summer clothing, which has more affordable prices. Meanwhile, they pointed out that people are getting used to the values of seasonal clothing, especially jackets, sweaters, and warm clothing in general, which arrived with very high values in relation to family income,” they explained from CAME.
Pharmacy
The April decline in pharmacies was 18% annually and added up to a 31.3% decline in the first four months of 2024 compared to the same period in 2023. In the month-on-month contrast, they fell 4.8%.
Pharmacies have a high comparison base and that accentuates the drop in relation to other items. Likewise, they are not going through their best moment, both due to the slowdown in sales and the delays in payments for social works. There were shortages of medicines and prices continued to rise sharply, despite the general slowdown in most retail sales areas.
Perfumery
Perfume sales sank 23.3% annually in April, and accumulated a decrease of 31.1% in the first four months, compared to last year. In the monthly comparison, the decrease was 4.8%.
“It is the item most affected by the economic situation because they are more expendable products. In addition, many of them are sold in pharmacies and supermarkets. From the businesses consulted, it was noted that people look for something more exclusive in the perfumery, but the customer postpones or discards the purchase when discovering the prices,” the CAME report stated.
Hardware, electrical materials and construction materials
Sales fell 11.2% annually in April, at constant prices, and the accumulated decline in the quarter is 22.5%, compared to the same period in 2023. However, compared to the previous month, they rose 1.5%.
The sector continues without reactivating, moving with small private works, spare parts, and some replacement of furniture or lighting. People are postponing more expensive purchasing decisions because they have no limit on their cards or because they are not sure they will be able to pay the installments in the future.
