Consumers in the Czech Republic will seek out greater value as the country is gripped by the economic downturn, a retail conference in Prague has been told.
Job losses in parts of the country will lead to a greater focus among consumers on price, one senior executive from meat processor MP Krásno told The Retail Summit, a two-day event held in the Czech capital.
“This will only happen in the countryside and regions with higher unemployment where purchasing power will continue to be lower,” MP Krásno sales director Pavel Kvác said.
The downturn could also lead to more frequent shopping at smaller stores, Incoma Research retail research manager Zdenek Skála said.
According to Miloslav Hlavsa, a manager at discount chain Coop, there had been a 20% rise in Czech shoppers visiting smaller stores in January.
Figures from industry analysts BMI suggest that high inflation and high interest rates in the Czech Republic had already started to weigh on retail sales in 2008.
On average, monthly sales rose by 3.2% year-on-year during the first half of 2008, BMI has claimed, down from 8.4% in the corresponding period of 2007.
Sales in Czech discount stores are set to rise from an estimated US$1.76bn in 2008 to $1.97bn, according to BMI forecasts.
Sales at co-operative stores are forecast to rise from $1.2bn to $1.25bn, while supermarket sales will fall from an estimated $5.92bn in 2008 to $5.81bn in 2009, BMI said.
Hypermarkets, which account for around 45% of grocery sales in the Czech Republic, are forecast to see their sales increase from an estimated $7.21bn in 2008 to $8.17bn this year.