Austerity-Crushed Greek Households Keep Cutting Food Purchases

Photo: Eurokinissi/Sotiris Dimitropoulos

ATHENS – More than seven years into a brutal economic crisis worsened by austerity measures hitting workers, pensioners and the poor, Greek households are continuing to cut food purchases, even for essential items.

Repeated salary and pension cuts have left millions unable to keep up, with a survey by the Marketing Laboratory of the Athens University of Economics and Business showing consumers spending  almost 40 euros ($42.72) less a month at supermarkets this year compared to 2016.

Average monthly household expenditure came to 274 euros ($292.63) against 310 euros ($331.08) a year earlier, with the 13 percent decline also reflected on supermarket turnover as the sector struggles to lure customers despite sales and 2-for-1 deals.

The study was aimed at average consumers who make up the bulk of supermarket customers drawing a bleak picture of their ability to buy what they want and as more turn away from brand names in favor of cheaper goods.

Some 63.4 percent of Greeks said they buy fewer products and 45.8 percent buy only the absolute necessities with 54.4 percent turning to private-label chain products.

Photo: Eurokinissi/Sotiris Dimitropoulos

Data from Nielsen researchers showed that in 2016, some 51 percent of brand products sold in supermarket were on special offer, up from 33.1 percent in 2009 and after super markets wouldn’t cut prices despite the crisis, until they were forced to do so by lagging sales.

Sales fell another 4 percent in 2016, driving the cumulative downturn to 18 percent since 2009, as the crisis began and a year before the then-ruling PASOK Socialists asked for what turned into 326 billion euros ($343.49 billion) in three bailouts.

The data compiled by Nielsen researchers showed that besides a sharp decline in demand and with more people turning as well to generic brands and looking for offers, that mergers and acquisitions, such as Sklaventis’ takeover of Marinopoulos, had taken a big bite out of the sector.

The phenomenon is likely to continue for several more years with analysts expecting a further drop of 2-3 percent.

In 2016, the sales value of food retailing – including small grocery stores – amounted to about 10.78 billion euros ($11.36 billion,) down 4.1 percent from 2015, pushing the sector back to 2005 levels and showing the devastating effect of the crisis and harsh austerity measures that brought big pay cuts, tax hikes, slashed pensions and worker firings.

The number of small food retail stores has dropped from about 32,000 in 2005 to 27,000 in 2015 with major chains showing their sales values plummet at the same time with only the discount food chain Lidl showing increases.