Dutch retail sector performs poorly in European context

Turnover generated by the Dutch retail sector declined more than 3 percent in the first quarter of 2013 relative to the same period one year previously. The Dutch retail sector is not doing well in relation to other EU countries. Non-food sales in particular fell short of expectations.

Record decline in retail sales

In the first quarter of 2013, the total amount of items sold by the retail sector was nearly 6 percent below the level of the same period one year previously, the most substantial downturn since 1994. Although retail prices were 2.5 percent up, the sector faced the largest turnover decline in four years. Retail sales have dropped for two years in a row.

Turnover and volume developments Dutch retail sector

Retail sales far below average level in the EU

The volume of Dutch retail trade in the first quarter of this year was far below the EU average. Only three EU member states performed worse. In fact, shopkeepers in the adjacent countries managed to improve sales. Retail trade in these countries appears to be less vulnerable to the effects of the recession.

Dutch retailers have underachieved in relation to their European counterparts in recent years. In the period 2010-2012, the volume of retail sales in the Netherlands contracted by 5.3 percent, while the average contraction across the EU was only 0.4 percent.

Volume of retail sales Netherlands and EU (countries with available data), 1st quarter 2013

Non-food sector lagging behind

The non-food sector entirely accounts for the downturn in retail sales in the Netherlands. In the period 2010-2012, the volume of non-food sales was far below the average level recorded across the EU. This applied in particular to DIY shops and home furnishing shops. Food, drinks and tobacco shops, on the other hand, achieved better results than the EU average. Within the food sector, supermarkets managed to retain the level of sales.

Volume of sales food and non-food shops in the Netherlands and the EU

Consumer confidence in middle bracket

Although consumer confidence in the Netherlands reached a historical low in the first quarter of 2013, the index was sometimes even lower in many other EU member states. Therefore, the low level of consumer confidence cannot explain entirely the unsatisfactory results of the Dutch retail sector. The volume of retail sales grew for example in Poland and Romania, despite the lower consumer confidence levels recorded in those countries.

Derk van Wijk