Swiss retail trade likely to grow slightly in 2024
Published: Tuesday, Jan 9th 2024, 11:20
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The retail trade in Switzerland is likely to grow slightly again this year. The food and online sectors in particular are likely to grow.
Consumers' budgets are being squeezed by the sharp rise in health insurance premiums and weak real wage increases, according to the "Retail Outlook 2024" published by UBS on Tuesday, which was previously published by Credit Suisse. However, the growing population and robust labor market strengthened consumption.
Specifically, retail sales are likely to increase by 1% in nominal terms overall in 2024. Real growth is also likely to be positive, albeit weak, at 0.3%.
The UBS experts expect growth in 2024, particularly in the food/near-food segment, which is benefiting from population growth. Food price increases are likely to slow in line with inflation and still average around 1%.
Stagnation expected in the non-food sector
Meanwhile, economists expect stagnation in the non-food segment. Inflation there is still likely to amount to 0.5 percent. This segment is likely to feel the impact of strained household budgets due to higher health insurance premiums and weak wage increases.
According to the study, shopping tourism also remains an influencing factor for the local retail trade: prices in neighboring countries are rising faster than in Switzerland due to inflation. Nevertheless, the local population is still likely to be drawn to the stores across the border in 2024.
This is because the strong franc means that the purchasing power of the Swiss in neighboring countries remains high. Inflation is also likely to continue to fall there.
Online retail continues to grow
Ultimately, however, online retail is likely to continue to grow: According to forecasts, this will have increased slightly in 2023 following a decline in the previous year.
According to the UBS experts, this trend is likely to continue in 2024. This means that online sales could account for almost 12% of total retail sales in the current year.
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