| | |  Business News | January 2009 
Mexican Retailers Brace for Weaker Sales in 2009
 Cyntia Barrera Diaz - Reuters
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Mexico City - Sales of Mexican retailers are set to decline further this year as a choppy economy hurts consumption, retailers group ANTAD warned on Wednesday.
Same-store sales of supermarket chains, department and specialty stores are expected to decline 4 percent in 2009, its worst performance in over a decade, compared with a 1.7 percent slip last year.
In 2007, same-store sales, or those recorded at stores open at least a year, rose a modest 1 percent.
Retailers plan to invest $1.3 billion in 2009, or less than half of what they invested last year, according to ANTAD. About 54 percent of the money will be used for store openings and another 17 percent for revamping existing facilities.
Rising unemployment, declining remittances from Mexicans living abroad, tightening credit, and high inflation are among the factors squeezing Mexican consumption.
Asked about potential consolidation in the industry, ANTAD President Vicente Yanez said, "We don't rule out mergers." But he added that there were no current indications about when they could happen or which players could be involved.
ANTAD, short for the National Association of Retailers, has Wal-Mart de Mexico (WALMEXV.MX), Soriana (SORIANAB.MX) and Comercial Mexicana (COMEUBC.MX) among its members.
Same-store sales dropped 10.7 percent in December, the worst monthly reading in five years, showing the effects of the economic slowdown. Results were particularly tough as the Christmas season, marked by aggressive promotions, failed to attract customers.
This year, the situation will likely remain difficult.
Economic growth in Mexico is expected to grind to a halt because the U.S. recession is slashing demand for the country's exports and the inflation rate is likely to remain high.
(Editing by Gerald E. McCormick and Jeffrey Benkoe) |
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