Rosh Hashanah was not a good start to the year for the retail chains, food manufacturers, and consumption. According to StoreNext figures obtained by "Globes," holiday sales dipped 3.5%, compared with Rosh Hashanah in 2015. This year's sales in a two-week period before and after the holiday fell NIS 60 million to NIS 1.87 billion, compared with NIS 1.93 billion in the same holiday period last year.
The retail chains and the manufacturers can take comfort in the fact that sales in the preceding two-week period rose by NIS 20 million, 1.2%, compared with last year. The total loss in sales for the four-week period is therefore smaller, amounting to 1.4%.
Holiday sales were down across the board. Food sales for the two week period were off 2.6%, but only 0.5% in the four-week period. All other sectors suffered a serious blow. Beverage sales were down 4.1% for the two-week holiday period and 3.8% in four weeks. Sales of home products and personal care products fell 6.4% in the two-week holiday period and 3.4% in the four-week period.
StoreNext said that a check of 25,000 items sold during the holiday both this year and last year showed that the price of half of the items remained unchanged. Prices of 27.9% of the items fell, and prices of 23.5% of the items increased.
Total sales of fast-moving consumer goods (FMCG) were down 0.4% in the first nine months of the year. This figure is slightly biased, however, because Rosh Hashanah fell in October this year and in September last year, making the number of shopping days in September this year 26, compared with 22 last year.
Two categories, cold cuts and chilled salads, stood out for the decline in their sales with an aggregate 13.9% loss in sales this year. The fall in sales was a direct result of the ongoing crisis in the cold cuts market, following the World Health Organization's statement that processed meat products contain carcinogenic materials, an announcement that also directly affected consumption of chilled salads, which are often eaten together with cold cuts.
The chilled salads sector was also affected by the quality crisis of Osem Investments Ltd.'s (controlled by Nestle SA (SWX:NESN)) Shamir and Sabra salads, in which salmonella bacteria were detected. The main victim is Soglowek, whose consumer sales plunged 19.9% in the first nine months of the year, while its market share dropped from 1.4% to 1.1%.
Four of the 10 leading suppliers reported lower consumer sales: Tnuva Food Industries Ltd. (-4.5%), Osem (-1.3%), Neto ME Holdings Ltd. (TASE;NTO) (-5.6%), and Diplomat (-0.8%). The other six reported higher sales, including Unilever, whose sales were up 0.6% in the first nine months of 2016, despite the double salmonella crisis in Telma's breakfast cereals. This figures indicates that the consumers did not punish Unilever's other brands, including its detergent brands, probably because they did not make a connection between the Unilever's various brands.
Published by Globes [online], Israel business news - www.globes-online.com - on October 26, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016