The “gilets jaunes” (yellow vests) demonstrations have hit French hypermarkets with a 15 to 25 % turnover loss, retailers see their turnover fall by up to 40 %. E-commerce in turn gets a boost.
Billions lost
According to the French Ministry of Economic Affairs, the “yellow jackets” protest that began some three weeks ago, has led to a turnover loss of 15 to 25 % in mass distribution. Retail has been hit even harder: turnover loss is said to be as high as 40 % in that industry, while up to half of all the hotel bookings have been cancelled. Fancy department stores such as Printemps and Galeries Lafayette had 30 % fewer visitors in the past few weekends.
The situation has cost billions, says French business newspaper Les Echos. French retailers really can not afford this turnover loss right now: “E-commerce and changing consumer habits had already heavily damaged French retail recently.” Add to that now a “clear drop in consumption, caused by the receding purchasing power in French familes. The gilets jaunes’ actions have only made matters worse.”
“Every industry is seriously concerned,” writes Le Monde, “as fashion boutiques, hypermarkets, toy and perfume shops have high expectations for the next four weeks. The end of the year is always very important for their annual turnover.” According to market research agency NDP, the perfume industry makes a quarter of its annual turnover in the following weeks. In toys the holiday season accounts for 40 %. “Turnover in December tends to be 2.5 times higher than in any other month.”
E-commerce emerges victorious
As often, misfortune for one is an opportunity for another. In a poll taken from 1029 French consumers, 56 % claimed they had changed their shopping habits as a result of the protests and barriers. About a third made fewer visits to physical stores and at least 43 % of consumers intends to purchase their Christmas and New Year’s presents online.
French retail’s last hope is a quick end to the protests. In the mean time, the government has decided not to apply the planned tax raise on fuel in 2019. Gas and electricity rates will be frozen for six months. It is a first step, but whether it will be enough remains to be seen: protesters are still calling for a massive demonstration on Saturday. “Too little, too late,” they say.
