The next crises have exacerbated inequality not only in Greek society, but also in the retail trade, which in recent years has again been looking for ways to adapt to new conditions. In fact, the latest crisis, the inflationary one, creates a “triple trap” especially for small and medium-sized enterprises, as INEMY ESEE characteristically mentions, namely: lower sales, higher operating costs and unsustainable debt.

Already the first consequence of successive crises is the resilience of companies with more than 30 years of experience. Their percentage has declined in 2022 to 26% from 31%, with the authors of the report attributing this development to the cumulative effects of a “multi-crisis,” as they usually call them.

Businesses are facing declining sales, rising operating costs and over-indebtedness issues.

The end of government support measures for businesses to cope with the effects of the pandemic has also exposed their over-indebtedness problems, problems exacerbated by increased operating costs from the second half of 2021 until today. Tax debts burden 28% of enterprises, and one in five has overdue debts to insurance funds. The number of enterprises facing difficulties in paying their suppliers has fluctuated at the same level (21%), while bank debts still fall on a significant proportion of entrepreneurs with active credit (about 8%). The percentage of businesses with supplier debt is back to alarming 2020 levels (nearing 21%), up from a very low 16% in 2021. This reflects volatility in the retail value chain, which may favor businesses that do not have liquidity problems in the medium term.

With regard to suppliers specifically, the report highlights another problematic element related to the overall production chain and the known efforts to change the country’s production model. What does the INEMY ESEE report reveal? That the trend in the supply of goods from Greece, which was observed during the two years of the pandemic, unfortunately did not continue, and Greek trade returned to importing goods mainly from third countries and mainly from China. Although the domestic market remains the main supplier of the retail business, its share has declined significantly by 10 percentage points from 2020 to present (61% in 2022 vs. 71% in 2020). The decrease in the participation of goods from the domestic market is offset by an increase in imports from Asian markets, which are on an upward trajectory and are returning to 2019 levels (13.6%).

Another worrisome element is that, due to increased operating costs, and perhaps also due to the anachronistic mindset that characterizes a significant portion of small and medium-sized traders, efforts to modernize their businesses are weakening again, leading to a widening gap with the largest sector enterprises. This is evidenced by the results of a study conducted by ESEE and included in its annual report. Thus, for more than four out of ten companies (42.8%), the main problem is “financial liabilities”, followed by “revaluation management” (25%) and “lack of liquidity” (23.6%). In contrast, “digital transformation costs” (1.8%) and “green costs” (0.3%) affect the retail business to a much lesser extent. “From what can be seen, successive crises make businesses passive receptors for megatrends (megatrends), as green transition and digital transformation issues are far from seeking short-term business viability,” the exhibition emphasized.