Swedish retailers expect declining profitability

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The joy of the retail sales growth in Sweden is deleted by declining profitability.
More retailers now believe profitability will decline the next three months.

Despite believing in increased sales, Swedish retailers believe that the profitability of the retail trade as a whole will decline in the next three months and 43 percent believe that the number of employees will be reduced.
This is shown by Svensk Handel’s Trade Barometer for May. The future indicator is unchanged compared with the April and lands on -7.

A few more of the surveyed retailers from last month, about half, believe that sales will increase. But just as many believe that the profitability of the trade as a whole will decline. The entire 43 percent believe that the number of employees in retail will reduce the next three months, five percent more than in April. This makes the future of the indicator remains negative.

”The joy of retail sales growth is deleted by declining profitability in a highly competitive trade,” says Jonas Arnberg, chief economist at Svensk Handel.

”Added to this is the increase in employer fees on August 1 that makes traders plan for redundancies rather than prepare for the new times,” says Jonas Arnberg.