Retailers cash in on feel good factor and low fuel prices

Retail sales in the Czech Republic climbed by 5.9 percent in 2015 compared to the previous year, the Czech Statistical Office has announced. That was the strongest sales performance since 2008, just before the country slumped into a long-lasting recession.

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The biggest rise in sales was recorded in goods ordered over the Internet or through mail order outlets, the office said. December sales, a key for retail success, were up by 16.7 percent year-on-year while the increase for the whole of 2015 was an even higher 19.7 percent. That figure was nearly twice as high as in 2010.

“We can talk about record Christmas sales for large part of Czech retailers, especially for internet shops, and retailers of electronic goods and household equipment”, CSOB bank analytic Petr Dufek told the daily Hospodářské Noviny.

Sale of fuels rose by eight percent last year, probably due to the low charges caused by falling global oil prices, while in December alone it increased by 12.5 percent year-on-year.

According to Marek Dřímal, an analyst for Komerční banka, the lower prices for fuel encouraged consumers to spend more on other goods. He told the Czech News Agency on Thursday that domestic consumption will continue to play a significant role have a positive effect on Czech economy.

Sales and repair of motor vehicles, which are recorded separately by the number crunchers, went up by 10.8 percent in 2015 compared to the previous year.

“Czechs are willing to spend more mainly thanks to a favourable development on the jobs market”, ING analyst Jakub Seidler told the daily Hospodářské noviny, adding that the country’s unemployment rate has been going down throughout the whole year, reaching one of the lowest levels in the EU. He also said that a growing number of companies were willing to increase their employees’ wages.