Inflation has not killed holiday shopping, say traders

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During the pre-holiday period, people's activity in malls and Internet shops is high, industry representatives say. The activity of buyers in high inflation also shows both the willingness to use savings for holidays and the wish to celebrate as usual, Latvian Radio reported on December 23.

Parking lots of shopping malls are packed right before the holidays. Uncertainty about the developments in the war in Ukraine, inflation and related cost increases are causing people to prepare in advance, estimated Henriks Danusēvičs, head of the Latvian Traders Association.

“As if times are difficult, but people have enough money for holiday. Maybe people are spending money too because they feel unstable. Better spend money today than lose its value tomorrow. Inflation is there, and it eats away some of the value of money. Those who have savings, I think, are spending with this idea,” Danusēvičs said.

This is also demonstrated by purchases of long-term goods, such as household appliances, which would otherwise be postponed. Customers have been happy to start preparing for holidays in good time, especially on weekends. For example compared to December last year, consumption of dough and pastry products has increased by a third, said Inga Bite, spokeswoman for Rimi Latvija. 

"Buyers also want to celebrate in these circumstances, given the experience of recent years and the time of the pandemic. Last year, the regime of both “red” and “green” stores was very actively respected. Shoppers' opportunities to visit shops with a wider assortment were limited. People are taking the opportunity to visit shops again at the moment," Bite said.

Unlike marking birthdays or name days, it is more likely that Christmas is celebrated by the wider public. Therefore, in difficult times, the traditions of these festivals, with gift-gifting and other usual things, will not be lost, according to the associate professor of social sciences at the University of Latvia, consumer culture researcher Marita Zitmane.

"It is very typical of humanity in general that consumption is naturally high after a variety of restrictions or periods of austerity. It is very likely that we want to spend more now, despite the fact that there is a war near us. We have overcome the toughest phase of the Covid-19 pandemic, now we want to celebrate the festival normally again, and then we will see how it will be. Consumption and celebrating – it is part of the normality, from being able to return to a normal, good life. It's undeniable. These things are very related," the researcher said.

Consumers' desire for spending is also reflected by the busy malls, local producers and crafts markets, as well as internet shops. The number of visitors and turnover figures have already been able to return to pre-pandemic volume. At the same time, buyers are actively seeking sales and discounts.

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