Household consumption for the full year 2018 landed at a modest 1.2 per cent in fixed prices, a figure that should be set in relation to the population development of 1.1 per cent. An incipient recession combined with structural changes poses major challenges for the Swedish traders. Jonas Arnberg, CEO of HUI Research, believes that digitization and internationalization are game changers for retail:
"All growth in the durable goods trade went to the network in 2018 and sales in the physical channels are shrinking. The end of 2018, with an unexpectedly weak December sale and a shift in Christmas shopping until November, also reveals that imported campaign days like Black Friday and Singles' Day have changed consumer buying patterns in just a few years."
The business cycle report from HUI Research is deepening in the competitive situation in the grocery trade. It is noted, among other things, that growth in recent years has been significantly higher in both the low-price segment and the high-end specialty goods trade than in the middle segment and the traditional food trade. However, by far, the fastest development is to be found the online.
"When food migrates to online channels, the retail shift goes into the next phase. With increased sales of food via the internet, traffic drops to our physical retail venues, which affects the entire retail segment. It is high time for retailers to review their store network structure and their digital strategy," concludes Jonas Arnberg.
HUI Research: The Sun Is Setting on Swedish Retail
Sweden — The cycle for the Swedish economy has peaked and we are currently witnessing the sunset of the economic boom. It is the overall picture that is emerging for both the retail and the Swedish economy as a whole, according to HUI Research. The European situation is shaky and the Italian economy is already in recession. Household concerns also have increased following the Riksbank's raise of the interest rate in December.