by Antonis Zairis*
Estimates for global retail turnover for the year are around $30 trillion and the contribution of e-commerce will be remarkable with over 25% of total turnover and with the dominant markets in e-commerce being those of North America, Asia and Europe.
The impressive strengthening of the middle income strata of the population and high technological integration will of course allow the emerging markets of India, Brazil and Indonesia to make a dynamic contribution to the global retail growth train.
With regard to new consumption habits, there is now a shift in the global consumer towards more sustainable practices with environmental sensitivity , climate protection , recycling and local products. Artificial Intelligence (AI) Technologies, Internet of Things and big data etc., are upgrading the personalization of the Consumer experience and forcing Retailers. to reshape their Strategies .
As for our country, the total retail turnover for 2024 amounted to 71.57 billion euros (an increase of 2.4% compared to 2023), while the forecast for 2025 is likely to exceed 75 billion euros, with a particular contribution from the food, e-commerce and technology and fashion products sectors. It is worth highlighting here that Retail turnover in 2024 net of food, motor vehicles and fuel , amounted to 25.97 billion euros, an increase of 1.8% compared to 2023.
It was also the growth of tourism that contributed significantly to the consumption of retail products as well as inflationary expectations that led to a rise in prices and a strengthening of the turnover of Businesses. According to recently available data from ELSTAT for 2025, turnover recorded a positive trend for the first two (2) months of 2025 as in January the general index increased by 2.5% compared to the corresponding month of 2024 , while in February it increased by 5.2% compared to February 2024.
If now we want to weight for 2 February this rose by 5.2% compared to February 2024.025 the determinants of participation in retail turnover growth then we will focus on : First ,the use of automated solutions by physical stores e.g. smart shelves , self checkouts etc. etc , with widespread use and diffusion of artificial intelligence in analysing and personalising offers to the consumer.
Second, on the continued growth of e-commerce as e-commerce will continue its upward trajectory with consumers opting for omni channel experiences and use of AR (Augmented Reality) technologies and chat bots meaning further enhancement of the Customer experience.
However, e-commerce is expanding and pushing traditional businesses to invest in digital channels too. Third, in redefining the role of physical stores and repositioning them in the “eyes” of the consumer’s eyes, as they will with as they will be transformed into interactive experience spaces with location and accessibility playing a critical factor in the choice of choice Fourth, the focus on sustainability issues as businesses are now choosing sustainable practices such as the use of recyclable materials, adoption of circular economy, products that highlight social responsibility, etc.
Fifth, the dynamic growth of small niche stores promoting unique products, of traditional origin , with local characteristics and specialised solutions Sixth, contactless payments and digital wallets claiming an important role in the context of commercial transactions with Consumers and Seventh, the structural transformations in the consumer profile that Businesses need to analyse and interpret thoroughly since Generation Z and Millenials will be the Consumers of the future.
In addition, Consumers prefer more economic choices , and in this way discounters and on line market places are facilitated . In addition, the demand for personalised experience and transparency in commercial transactions remains strong.
As regards the macroeconomic factors which to some extent involve high risk due to unpredictability but, on the other hand, will significantly affect the development of retail turnover in our country for 2025, they are: The prospect of GDP growth and the disbursement of the recovery fund (RRF) and their leverage in the real economy ,the course of inflation that affects the purchasing disposable income, the prospect of “monoculture” tourism (since 1 in 4 € of tourists goes to the purchase of products), the demographic aging that overturns the data of purchasing choices in the product portfolio of the Businesses ,the continuing dynamics of e-commerce and the unstable legislative and tax system.
On the other hand, regarding the main challenges that will face the retail sector in the current year, 2025, and the next year, in a de facto unstable and volatile environment, these have to do with:
First , with the squeeze on disposable income due to the continued accuracy despite the relative easing of inflationary pressures and the increased labour and raw material costs Second , with the continuing shortage of skilled staff and the great difficulty in finding and maintaining them, particularly in the supply chain and customer service sectors, which further complicates the operation of businesses.
The need for lifelong education and training in new digital skills should be included in the agenda of priorities of a modern Retail Business Thirdly, with the rapid and dynamic development of artificial intelligence , automation in general and big data that are changing the way retailers operate. Companies that delay the transition to the new digital environment and do not adapt immediately will lag behind the competition Four
Fourth, by understanding the functioning of the global supply chain in combination with the ESG (environment-society-government) legislative framework that will necessarily lead to a new more resilient and sustainable operating model; and Fifth , with the changing nature of competition and market over-concentration. Competition is primarily about prices and is likely to lead to a reduction in profit margins but it is also about quality, service and the overall service provided to the customer.
However, the pressure is also intensifying on the new digital platforms of the multinationals, e.g. Amazon, Temu, etc., which also cause problems in terms of competition for businesses.
All the previous factors will in one way or another affect consumer spending and will play an important and primary role in the development of the retail sector as , for the reasons mentioned above, retail is directly and inextricably linked not only to GDP grow
*Professor - Exec. Vice President of SELPE, Member of the Association of American Economists (AEA)
By: N. Peter Kramer
