Trade activity has biggest drop in 20 years, serasa shows

Mobility restrictions and social isolation have imposed the worst result on retailers in two decades. Data from the Trade Activity Indicator obtained by Serasa Experian show that retail sales showed a significant decrease of 31.8% in April, compared to the same period in 2019. This is the most intense drop since January 2001, the beginning of the historical series. The last time trade had felt such an expressive fall was in January 2002, when there was a 16.5% drop. The monthly comparison of the indicator also shows a worsening in sales volume, with a drop of 19.4% between March and April. The retraction follows another decrease that had been observed in the passage from February to March (-16.2%), which demonstrates an intensification of the unfavorable scenario for trade. In 2020, the indicator already accumulates a negative result of 10.1% compared to the first four months of the previous year. According to Serasa Experian economist Luiz Rabi, the results reflect the social distancing measures adopted to combat the health crisis. "With shop stores closed behind closed doors, retailers have seen their inventories increase and demand for products decrease," Rabi explains. "This is a time when traders need to innovate to maintain a leaner and at the same time functional operation." "The internet and delivery services are a creative solution, but still insufficient to reverse losses, because they don't work for any kind of business," he says. Rabbi also adds that there is a crisis of confidence that keeps people away from consumption. "At a time of instability in which many are insecure in their jobs, Brazilians retreat to non-essential consumption. Even those with higher purchasing power end up directing their resources to an emergency reserve," says the economist. According to the indicator, segments more dependent on consumption via credit suffered the most negative results in April. The highlight was the furniture, appliances, electronics and computer sector, which pulled the drop of the indicator with a significant retreat of -39.9% compared to last year. Establishments that sell fabrics, clothing, footwear and accessories appear next with a drop of -39.6%. The branch of vehicles, motorcycles and parts (-33.1%) and the construction material (-32.1%), complete the ranking. The sectors that showed less intense falls are linked to basic necessities, such as supermarkets, hypermarkets, food and beverages (-24.3%) and fuels and lubricants (-19.3%). The Serasa Experian Trade Activity Indicator is built exclusively by the volume of monthly consultations carried out by about 6,000 commercial establishments to the Serasa Experian database.