Retailers say successful summer may not compensate for negative cash flow ({{contentCtrl.commentsTotal}})

Shopping mall interior. Source: Anna Aurelia Minev/ERR

Following spring, when larger shopping malls were closed due to the coronavirus pandemic, the public have started to shop more. However, store owners said that the relatively successful summer won't compensate for the negative cash flow which spring brought.

Decreased income for retail trade enterprises during the coronavirus emergency situation and beyond is now recovering, to levels higher than the previous year in fact. ETV current news show "Aktuaalne kaamera" reported that revenues are seven percent higher than at the same time last year.

Travel restrictions still in place through summer have meant far more Estonians are holidaying inside their home country, rather than abroad, which has also been a factor in the retail revenue improvement.

The number of visitors to the Lõunakeskus mall in Tartu fell by 70 percent in April, and the turnover suffered at the same amount. However, if in June, we can see the restoration of the previous situation, it will depend on the sector.

"It can be seen that in some areas the decline is smaller, in some areas, greater. The fluctuation and scale are certainly very large. For example, entertainment, cinema, catering, tourism, suitcase accessories - these shops are doing worse. At the same time, electronics, sports equipment, leisure goods, clothing are doing better," Marju Jeedas, CEO at Lõunakeskus, said.

Head of the Ülemiste center in Tallinn, Guido Pärnits, thinks that summer will be quite good. "There are two reasons. One is definitely the fact that people were without the possibility to properly shop and consume for a month and a half. This is definitely an effect that the doors are open and people can buy what they want to buy," Pärnits said.

"The other thing, which can last throughout summer, is that Estonians are at home all summer. A large part of the money that was taken abroad usually during summers stays here," he added.

Retail sales of motor fuel also started to increase, rising by one percent compared with June of the previous year. The sales revenue reported y Olerex fuel chain decreased by 30 percent in both April and March. Since June, the situation has however been better than last year, with the cut in excise duty on diesel fuel earlier in the year being a factor.

"We hope at least the second half of the year stays at the same level as it was last years, maybe with a small plus, we can cover the negative cash flow, which came with the first half of the year," Anton Šafrostin, Olerex's fuel purchasing and logistics manager, said.

The Ülemiste Center director said that the strong summer alone won't compensate for the negative cash flow that came in spring. Pärnits still hopes that when the second wave of coronavirus comes in autumn, it will be more relaxed and the year will be finished with a profit.

"If we take current numbers on the basis of Ülemiste, then at the end of the day, we have negative cash flow but I think that at the end of the year, we will be good again."


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Editor: Roberta Vaino

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