In a time of pervasive business uncertainty, one thing is quite certain until the end of this year – most Croatian companies will finish this year with significantly higher revenue than last year. Those who fail to achieve this in these inflationary conditions might as well lock the door. However, companies that will finish this year with high revenue growth from sales that will not be supported by an increase in sales volume may also start thinking about the lock. They are on very slippery ground.
The State Bureau of Statistics reported at the end of last week that nominal retail trade turnover in June was 0.7 percent higher than in May, while real turnover fell by one percent. Meanwhile, turnover from retail trade in food products increased by 4.7 percent, while turnover from retail trade in non-food products (excluding motor fuels and lubricants) fell by 6.4 percent. It is enough to spend half an hour in any supermarket to see that customers mainly linger around the shelves with products at promotional prices. What is not on promotion does not sell!
The high revenue growth from sales of most domestic manufacturing companies, especially in the fast-moving consumer goods segment, is not supported by an increase in the quantity of goods sold. The quantity sold has been decreasing since the beginning of the year, which is now not visible due to tourist spending. Companies are aware of this, so those that are seriously concerned about what will happen with sales in the fall are consciously encroaching on their own profits to avoid excessive price increases.
