Fenalco says sales in the trade sector have increased, but will be affected by inflation

In the magazine Bitácora Económica, the National Federation of Traders, Fenalco, headed by Jaime Alberto Cabal published the results of its business survey. It shows that 44% of the companies consulted report a record of higher sales compared to those in 2021, while 37% of businesses say they feel a similar volume, and in contrast 19% say that they have decreased.

Climate factors have negatively affected the country's trade sector: the long winter season has led to a decrease in visits to businesses, according to President Cabal, this trend is most noticeable in cities with a warm climate.

Fenalco also assured that 46% of traders believe that throughout 2022 the country's business situation will continue to recover, while 12% do not share this position, on the contrary, they consider the opposite. Everything will depend on how price increases continue to behave. There are sectors such as vehicles that are already beginning to notice the slowdown due to inflation.

“The general increase in prices over the last few months has forced traders to rearrange their operations and to make an effort not to transfer all of the cost overruns to the consumer, which suggests that, although March has a good balance, the inflation peak may change the picture in the coming months. months,” said the president of Fenalco, adding that the increase in the prices of the family basket, for example, is already causing Colombians to prioritize other items or services.

In fact, new habits have been evident among consumers, as there has been an increase in purchases through digital channels, and Fenalco even points out that shoppers spend less time in “large format warehouses”. The report emphasizes that “there is now less tolerance for delays in care”, this, for example, in places such as shopping centers or in food courts. One fact that was revealed is that, again, the so-called “impulse purchases” are being seen, which almost disappeared during the pandemic, but the figures are still far from what they were in 2019, before the lockdowns.

The report highlights that for traders the day without VAT generated a great dynamism in sales, occasionally in the textile and clothing sectors; that day saw a 44% increase in sales. Other businesses that reported positive figures that day were footwear, school supplies and household products.

Particularly on March 11, the day without VAT, the figures recorded in sales were 9.1 billion pesos, even, DIAN announced that almost 7 million invoices were recorded.

However, traders are beginning to feel the consequences of the increase in inflation, Fenalco estimates that in the coming months these “positive results” can be changed by the rise in input products. In the main problems for trade, factors such as the cost of purchasing goods, product shortages, insecurity, informality, among others, are highlighted. Traders also point out that in some sectors there is a “shortage of qualified personnel and excessive regulation”.

“Unfortunately, inflation is causing supermarket carts to be left with many products in boxes that buyers cannot take because their budgets do not allow them to,” says the federation, adding that negotiations with suppliers that were set at the end of a year, are now made for a month due to the difficulties in the supply.