Spain: Fashion sales in fall for the first time in November since 2020

Business

Credits: Josh Wilburne on Unsplash.

Madrid – A cold and unflattering Christmas for the Spanish retail fashion industry is what we are heading towards in 2024, based on the -2.8 percent drop in sales for the sector as a whole during this already surpassed month of November. A period in which, with the arrival of “Black Friday”, the unofficial start of this strategic holiday campaign takes place, which has not prevented the entire sector from ending up experiencing the first drop in turnover recorded in a month of November since 2020, in the midst of the coronavirus pandemic, also putting an end to the upward streak that it had managed to maintain in this 2024 for up to four consecutive months.

What has ended up happening in November? And will its effects have repercussions that go beyond that, and will last longer, affecting the fashion retail industry in Spain? These are the two main questions that arise from the results collected in the latest analysis of the sector's sales prepared by the National Association of Retail Fashion Acotex, and which end up leaving the entire retail fashion industry in Spain experiencing a sales drop of -2.8 percent compared to the results obtained during the same period a year ago. A drop that seemed completely impossible in view of, first, the positive growth that the sector had consistently managed to maintain in its sales since the end of the pandemic during the month of November, as a faithful reflection of the increasingly consolidated role that the "Black Friday" and "Cyber Monday" days have ended up playing within the purchasing habits of Spanish consumers in view of the strategic Christmas campaign; and second, due to the very marked upward trend with which the sector had managed to perform until now, chaining together four consecutive months of positive growth since July. An upward streak whose culmination came this past October, with a sector that, according to the data analysed and assessed by Acotex, managed to boost its sales by +7.3 percent compared to the figures from a year ago. The greatest growth experienced by the sector in all of 2024, and an increase in sales that came to fully compensate for all the falls and the limping growth experienced during all the previous months, to finally manage to leave the entire sector in positive territory, with an accumulated growth that went from registering a contraction of -0.46 percent at the end of September, to an increase of +0.48 percent at the end of October.

In this context, and looking ahead to the upcoming Christmas campaign, Acotex did not hesitate to show itself more than confident in the good performance that the set of fashion retail companies in Spain would manage to perform in this regard. A confidence that led them to estimate that annual sales growth would reach +0.48 percent recorded at the end of October, to around +2 percent by the end of the year, slightly behind the increase of +2.8 percent recorded at the end of 2023. A new weakening of the trends towards the recovery of the sector of all the sales volume lost during the pandemic years, but still a positive fact, and that Acotex was confident that the sector would reach a firm supported by the good progress of the Christmas campaign of this 2024, and that this was how they estimated it would be, from minute one, that is to say from this very month of November in which it started unofficially, based on that extraordinary increase in sales recorded in October. A month in which, as we were already in charge of putting it in value at that time from FashionUnited , if it had been characterized by anything, it is precisely by showing a weaker and more hesitant sales performance compared to the whole year, in addition to being, as a rule since the end of the pandemic, lower than that registered by the sector during the months of September and November. Something easy to understand because it is situated between the last summer sales and the arrival of the new collections in stores, and the arrival of discounts due to the start of the Christmas campaign, trend estimates that have all been broken in 2024, with a month of October that has ended up standing at +7.3 percent growth, higher than that registered in September of +2.9 percent, and this alarming fall of -2.8 percent registered now in November; the first that the sector has experienced in a month of November since the fall of -37.1 percent registered in November 2020, with commercial activity blocked in the midst of the coronavirus pandemic.

Heading towards the Christmas campaign with “optimism”

In an attempt to answer the two questions we posed at the beginning of these lines, about the possible causes that could have led to this worrying drop in sales, which points to a complicated Christmas campaign, Acotex points out that, among its possible reasons, there would be a mere question of dates, pointing out that on this occasion, and unlike previous years during which both the “Black Friday” and “Cyber Monday” days were celebrated within the month of November, on this occasion the first has occurred in November, as “tradition” dictates, but the second has already occurred in December. A distribution that would have led to all the sales generated during “Cyber Monday”, and also during the Sunday after “Black Friday”, having already been counted in the month of December. A plausible justification, to which we add here, without Acotex mentioning it, the effects on the consumer that may well have been caused by the flooding that the metropolitan area of Valencia was subjected to during the last days of October, and which have since been dominating the national news, which could well have generated a contraction in spending on fashion among consumers.

On the other hand, regarding the duration of these effects, whatever they may have been, Acotex does not expect the contraction in sales experienced by the sector during the month of November to continue during this month of December, which we are now in. Month in which the last purchases of the year of fashion products, footwear and accessories will have to be completed, sales that Acotex trusts will once again occur with a slight increase compared to a year ago, which will allow the sector to close the year in positive growth territory, it is understood that also at a rate higher than the +0.21 percent at which the annual accumulation of this 2024 is currently located, although Acotex has no longer indicated any estimated figure, foreseeing as practically impossible that sales can increase up to that indicator close to +2 percent with which they trusted at the end of October to close the year.

“The month of November has not been a good month for sales, with a drop in sales compared to 2023 of -2.8 percent”, and “with the annual cumulative total practically flat with an increase of +0.21 percent”, says Eduardo Zamácola, president of Acotex, in statements sent to us by the same management of the retail sector employers' association in Spain. As a result of this drop, and in line with what has already been pointed out, “the upward trend of the last four months has stopped”, as a result of “sales results during the month of November” that “have been very bad” for practically the entire month, analyses Zamácola, “recovering somewhat during the days of 'Black Friday'”, but in a way “insufficient to turn around” the monthly performance of the sector. On this same issue, “it must be taken into account that last year Black Friday fell entirely in November, and this year Sunday and Cyber Monday fell in December”, which would have affected the data collected and comparables, justifies the president of Acotex. Meanwhile, and “in view of the Christmas campaign”, from the retail employers' association “we are optimistic and we hope to close the year with a slight increase in sales”.

This article originally appeared on FashionUnited.ES, translated and edited to English.

It was translated using an AI tool.

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