Fewer Supply Bottlenecks in German Retail

Supply bottlenecks at German retailers eased in May, finds the latest ifo Institute survey. In May, 41.3 percent of the businesses surveyed reported shortages, down from 45.7 percent in April. “The share of retailers affected by supply problems has been falling steadily since the beginning of the year,” says ifo expert Patrick Höppner. “However, the business situation remains gloomy for many. Fewer consumers are going to shops, and when they do they’re buying less due to inflation,” he adds.

Bottlenecks are particularly noticeable among food retailers at 65.8 percent, down from 70.4 percent in April. Retailers of electrical household appliances noticed an easing in supply chains, with 34.3 percent of the businesses surveyed reporting bottlenecks, down from 68.7 percent in April. “The recent price hikes in many areas of retail have depressed consumer demand,” Höppner says.

In the first quarter of 2023, 42.9 percent of all retailers reported having fewer customers. DIY centers (69.3 percent) and furniture stores (65.4 percent) are among the most affected.