Expectations in the Retail Sector Stronger than Last Year TEPE moved upwards in June but it could not make it to the positives: minus 0.6

TEPE increased in June 2013 month-on-month and year-on-year, while the Index is still in the negatives. Anticipation for business recovery and expectations weakened compared to May 2013 but improved compared to last year. Retail confidence in the EU and the Eurozone was up month-on-month but weaker compared to June 2012.

TEPE, after the decline in May, moved upwards in June even through it could not make it to the positives. With a value of minus 0.6, TEPE increased by 1.6 points month-on-month and by 6.1 points year-on-year.

The balance value of the expectations for the next three months was 19.3 in June 2013. Expectations increased by 11.3 points compared to June 2012 and by 1 point compared to May 2013. 41.2 percent of TEPE survey participants expect an improvement in their business activities in the next three months while 31.5 percent expect deterioration.

The balance value of the volume of business activities compared to the same period in the previous year was -23.3. Anticipation for year-on-year recovery in business activities therefore decreased by 0.9 points compared to May 2013 and increased by 9.3 points compared to June 2012. In June 2013, 21.4 percent of the participants declared a year-on-year improvement in business activities whereas 42.1 percent declared deterioration.

The EU-27 Retail Confidence Index had a value of minus 10.2 in June 2013, with a month-on-month increase by 1.8 points and a year-on-year decrease by 0.3 points. Turkey performed better than both the EU-27 and the Eurozone.

Comparing the retail confidence indices for EU-27 countries and Turkey, the highest year-on-year rise was observed in Greece. The country was followed by Slovenia, Turkey, and Bulgaria. The sharpest year-on-year drop was observed in Finland. The country was followed by Southern Cyprus, Latvia, Belgium, and the UK. Slovenia recorded the strongest month-on-month improvement. Unlike in previous months, the EU-27 Retail Confidence Index was weaker than the Eurozone index compared to both June 2012 and May 2013.

Compared to June 2012, textiles, ready-made clothing, and footwear sector was the strongest performer of the retail sectors. This was followed by the food, beverages and tobacco products, motor vehicles, and the “others (gas station, pharmacy, perfumery, hardware, glassware, stationery etc)” sectors. Year-on-year improvement in these four sectors was above the average. Furniture, lighting equipment and household articles, non-specialized stores sectors were below the average in terms of year-on-year improvement. The sharpest drop of the month was observed in the electrical appliances, radio and televisions sector.

Question-based assessment of the TEPE survey results reveals that all current indicators and expectations except for the expectation for the level of sales in the next three months decreased compared to May 2013. The sharpest drops were in the expectations for orders placed with suppliers and sales prices in the next three months, and for the number of stores in the next year. Compared to June 2012, all conditions and expectations but the expectation for sales prices in the next three months increased. The largest was in the expectations for orders placed with suppliers and sales prices in the next three months, and the level of activities compared to previous month and year.

Konya’s retail sector weakened month-on-month and year-on-year

In the context of the Konya Province Retail Confidence Index (KOPE) carried out in cooperation by Konya Chamber of Commerce (KTO) and the Economic Policy Research Foundation of Turkey (TEPAV), face-to-face interviews with 300 retailers from Konya have been carried out on a monthly basis since February 2012.

In June 2013, KOPE had a value of minus 1, compared to TEPE at minus 2.5. Konya’s retail sector continued the downwards movement that started in May and remained in the negatives. Yet, it performed better than overall Turkey and the EU-27 in June. KOPE showed a year-on-year decline by 2 points, while TEPE increased by 6.1 points over the same period.

Expectations for orders placed with suppliers, sales and employment in the next three months and the level of business activities increased year-on-year. All expectations and indicators except for sales expectations increased also month-on-month. 47.8 percent of retailers in Konya think that the volume of business activities worsened compared to June 2012.