Retail: What to expect in 2020?

After recording in 2019 a decline in sales and loss of formal jobs, companies in the commercial sector of Costa Rica predict that during next year their revenues will begin to recover.

Thursday, December 5, 2019

The current year has been a year of economic and commercial contraction, mainly because of the loss of consumer confidence and the consequent reduction in sales, which in turn reduced the capacity for investment and employment generation by companies, explains a statement from the Costa Rican Chamber of Commerce (CCCR).

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According to the guild for the period between the 1st Quarter 2018 and the 3rd Quarter 2019, informal employment in the commerce sector increased by 24% and formal employment in the sector decreased by 22%, demonstrating a shift of traders from the formal to the informal sector.

The paper notes that "... By 2020, the Chamber of Commerce of Costa Rica has identified some priority areas or issues for the sector, which should be on the agenda of the Alvarado - Quesada Administration. These issues are: Promotion of Business Formality, Fight against Smuggling and Illicit Trade, and Trade Facilitation."

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Yolanda Fernandez, president of the CCCR told Nacion.com that "... they are optimistic for 2020, with prospects for stabilization and the beginning of recovery, both because it is expected a rebound in consumer confidence and because the impact of the Law to Strengthen Public Finance (tax reform) would already be diluted, after six months of implementation. The combination of factors, would make the consumer decide again to buy again."

Also see "Where do consumers travel?"

Regarding consumer confidence levels, the most recent report from the University of Costa Rica explains that, despite the fact that between August and November 2019 the confidence index increased 13%, consumers still have a significant degree of uncertainty.

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More on this topic

Economic Growth: Businessmen's Predictions

December 2019

In Guatemala, 54% of businessmen believe that in 2020 the local economy will accelerate, 42% believe that stable growth will be reported and 4% believe that a slowdown could be reported.

According to the Third Business Perception Survey conducted by the Coordinating Committee of Agricultural, Commercial, Industrial and Financial Associations (Cacif), 67% of respondents expect greater growth of their companies and 56% expect more employment with the arrival of the new government.

When Confidence Disappears

September 2019

Business confidence in Costa Rica fell in the third quarter to levels reported in 2009, a year marked by the global financial crisis, and in consumer’s pessimism has also rebounded, because no effective and short-term measures are perceived that tend to reactivate the national economy.

Businessmen are not very optimistic about the development of their businesses in the coming months, as comparing today's Business Confidence Index (IEC) (5.3) with that of a year ago (6.2) shows a significant decline. In addition, this indicator accumulates 10 quarters of gradual slowdown, reported the Costa Rican Union of Chambers and Associations of Private Business Sector (UCCAEP).

Retail Sector to Grow Slightly in 2018

December 2018

The fall in the automobile and construction materials sales was determinant in the increase of only 1.6%, which is forecast to close the year by companies in the commercial sector in Costa Rica.

Representatives of the Costa Rican Chamber of Commerce (CCCR) reported that expected growth for this year will be only 1.6%, significantly below the 3% average annual increases that have been reported in previous years.

Lower Consumer Sales in Guatemala

July 2009

Despite commercial efforts in promotions and discounts, consumer sales were down 4.3% in the first half of the year.

Commerce will shrink 1.5%, mainly because the 29% drop in imports, informed the Central Bank of Guatemala.

"Lack of customers has forced businesses to sell cheaper, reducing profits...", said César Estrada, president of the Chamber of Commerce and Services, in an article in Elperiodico.com.gt.

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