No revenge shopping in Turkey

Turkey’s 450 odd shopping malls, which opened partially on May 11, resumed service fully on 1 June with a broad participation of stoes as normalization also included cafes, restaurants and gyms. However, shopping malls spent the first day quiet and vacant. Industry insiders   expect   revival  in customer traffic to take place two weeks. Even then, it is clear that wide-spread unemployment and fear of infection is keeping Turkish consumers away from revenge shopping.  Hundreds of malls and their shops could go bankrupt, as FX loans come due and turnover fails to cover very high fixed costs.

Shopping malls, only 60 percent of which opened on 11 May, reached 40 percent of the turnover before the pandemic, while this rate remained at 25 percent for brands. Hüseyin Altaş, the President of the Shopping Center Investors Association, said that due to the curfews before and the brand shops not fully opening their doors, total sales  remained at 40 percent in terms of turnover compared to before the pandemic, and that the first week will be the determining factor in new spending patters.

Need-oriented visits to ready-to-wear

Ready-to-wear stores accepted customers cautiously into their shops as social distancing measures, such as masks and disinfection procedures  added to the pain of a limited number of visitors. In the next period, this decline was also reflected in the brands, which received a limited number of visitors. The store manager at a brand’s shopping mal outlet said, “There was a drop in customers even before the pandemic. Those who come shop quickly and leave in haste. ”

Brand sales remained at 25 percent of pre- pandemic figures

Of the 409 franchises  that are members of United Brands Association (BMD) have opened  only 14 percent of their nearly 70 thousand outlets.

BMD President Sinan Öncel stated that it will take time to reach the pre-pandemic figures in turnover due to the social distancing rules and low demand. Öncel informed that BMD member brands that previously opened have already reached 25 percent of their pre-pandemic turnover.

According to initial data, the number of visitors remained at the rate of 20 percent before the pandemic in most shopping malls.

Food floors still vacant, normalization will take 2 weeks

Visitors showed a tendency to purchase their needs and leave quickly, with very little window shopping. Ramazan Bingöl, President of All Restaurants and Tourism Association, said that the opening rate in shopping malls remained at 50 percent, while street restaurants and cafes reached close to 100 percent. Indicating that there is a decrease of 80 percent in restaurants and cafes opened in shopping malls compared to the pre-pandemic, Bingöl stated that this rate is 40 percent in the streets. Bingöl said, “In some shopping malls, 90 percent of food and beverage areas have not been opened. We expect them to open in 15 days.”

The Grand Bazaar opened after a 3 month hiatus

Shuttered due  to coronavirus measures, the Historic Grand Bazaar and the Spice Bazaar started to serve again as of 1 June. Ali Yerlikaya, the Governor of Istanbul, who presided over the opening ceremonies, stated that they had previously said “stay at home” because of the epidemic but now it is time to return to work. Yerlikaya said, “Our production, service sector, Grand Bazaar, our Egyptian Bazaar, our shopping malls, our tradesmen, craftsmen, industrialists will all follow the rules, we will help each other, but we will return to work. We have slowed down economically for three months, but we will quickly get up from where we  fell and re-create the dynamic economy. ”

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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.