Unstable political situation takes toll on retail sales
With a Viktor Yushchenko victory almost certain, Kyiv residents are getting into the holiday spirit, but some retailers say that sales have been slower this season than in the past.
“As the revolution neared its end, protesters suddenly realized that they needed to do their holiday shopping,” said Svitlana Kravchenko, marketing manager of Kyiv’s Tendence stores, which specialize in imported decorative items from China, India, Hungary, Thailand and Egypt.
Orange Christmas decorations have been popular this holiday season because people seem to be interested in buying gifts with special meaning, she added. Orange-colored artificial Christmas trees, which her shops do not carry, are among the most popular novelty item this year. “Their production only began about a week and a half ago in Lutsk – we simply couldn’t deliver them in time for the holidays,” she said.
While sales of holiday decorations are steady, larger ticket items are not doing as well.
“It seems people are still holding out on their major purchases,” said Natalya Vozna, head of marketing at the Central Department Store (TsUM), on Dec. 27.
Historically, peak sales occur during the last week of December, but this year the rerun election seems to have disrupted that pattern. In the past, the most popular gifts purchased at TsUM were soft toys, jewelry and lingerie. Vozna is keeping her fingers crossed that the store will see a lot of last-minute purchases in the near future.
Tendence’s Kravcenko agreed that shoppers seem more conservative this year than in the past. As a rule, the amount people are spending has decreased, she said, “With the exception of happy revolutionaries.”
Viktor Pyvovar, commercial director of Caravan Megastore, a shopping mall located in Kyiv’s Obolon district, said the unstable political situation had a direct impact on consumer spending, which has affected stores’ revenues negatively.
The number of shoppers did not decrease, he added, but the amount of money they spent did. People were in a hurry to stockpile “strategic food items” that can be stored for a long time like cereals, pasta, flour and sugar, in case of inflation. But things are slowly getting back to normal at Caravan. People are in a hurry to buy alcohol, traditional holiday foods and chocolates for the New Year.
Pyvovar said that daily revenues at Caravan have increased up to 60 percent this month, compared to daily revenues during the rest of the year. The average food and alcohol purchases for the New Year – as well as small gifts like household appliances, kitchenware or cosmetics – total about Hr 400. At the very least, Pyvovar hopes this number does not go down up before Dec. 31.
Surprisingly enough, the average purchase at Esprit, a clothing shop selling casual clothes for men and women imported from Germany, is also between Hr 300 to Hr 400. At Esprit, more affluent shoppers buy long-sleeved t-shirts, waistcoats, and other clothing as gifts, while students tend to buy trinkets, strings for mobile phones and wallets.
Esprit’s Manager Halyna Bulatova says that even though the average daily turnout prior to the holidays is about five times higher than usual, purchases remain quite low compared to last year’s figures, which exceeded an average of Hr 1,000 per purchase. “People got scared by the situation in the country, and, therefore, are very cautious about spending at the moment,” she said.
Bulatova says that unlike last year, when shopping fever started around Dec. 1, this year’s holiday spike began after Dec. 26, when the last round of elections took place.
She says her shop, located in the Globus shopping center, most likely suffered from its location underneath Independence Square, the Orange Revolution’s epicenter. Bulatova doesn’t remember seeing protesters shopping at Esprit.
“I don’t believe our shop is affordable to most of them – the protestors visited Globus mainly to warm up,” she said.
