Retail Sales Monitor – Issue 4/2023 - Focus: German retail stationary and online

From the coronavirus pandemic to high inflation rates and the consequences of geopolitical upheaval: The German retail sector is in a state of crisis and upheaval. One thing is clear: the economic situation remains tense in the face of gloomy consumer sentiment - and the digital transformation is also driving massive upheaval. In order to remain competitive, complex tasks need to be mastered.

An overview of the status quo is essential for this. Where does the sector stand in terms of bricks-and-mortar and online retail after an exceptional number of years - and which demand trends are particularly relevant? In Issue 4/2023 of our Retail Sales Monitor, we categorise the market situation based on a comprehensive analysis. We shed light on developments in terms of turnover, sales channels and structures across multi-year trend lines. The focus is on figures for the industry as a whole as well as the food, non-food, fashion, consumer electronics and DIY segments.

• According to the Federal Statistical Office, retail sales totalled 630.7 billion euros in 2022. Compared to the previous year, this was a nominal increase of 7.2 per cent, but a decrease of 0.8 per cent when adjusted for inflation. The share of online retail was 13.4 per cent.
• More than 60 per cent of the turnover of the 1,000 top-selling sales channels in stationary retail was attributable to food retail (LEH). The DIY & furnishing segment followed in second place with 13.7 per cent.
• The five largest food discounters recently increased their sales results, in some cases significantly. The market share of discounters in the food retail sector rose in 2022, partly due to consumers' increasing price awareness. The share had previously fallen for three years.
• The recovery in fashion retail has been sluggish during the coronavirus crisis. The turnover of only two out of ten companies in a top ten ranking of the sales channels with the highest turnover was higher in 2022 than in 2018. As in food retail, low-price formats are the growth drivers.
• After very high growth rates during the pandemic years of 2020 and 2021, e-commerce suffered a setback in 2022. According to an EHI study, the turnover of the 1,000 top-selling B2C online shops totalled €77.7 billion, €2.2 billion less than in the previous year.

In addition to the comprehensive industry analysis, the Retail Sales Monitor also provides detailed information on the latest figures from the industry as a whole and the food, non-food, fashion, consumer electronics and DIY sub-segments, as usual:

• In the third quarter of 2023, the retail sector continued the weak sales trend of the previous months: Retail companies generated price-adjusted sales of 2.8 per cent less in the summer months than in the same quarter of the previous year.
•  The persistently weak consumer climate led to a further decline in sales in German e-commerce in the summer months: Online retailers recorded a decline of 13.9 per cent compared to the same period last year.

For the KPMG Retail Sales Monitor, we analyse the developments, trends and drivers of the industry on a quarterly basis together with the EHI Retail Institute. You can subscribe to our newsletter here.