Wholesaling: Worsened Business Outlook

In wholesaling, the business climate indicator fell in January, which was solely due to the poorer business outlook. The share of companies expecting a less favourable business development in the first half of 2019 rose to 22%, while only 13% of wholesalers anticipated an improvement. On the other hand, respondents were still satisfied with the current business situation – even somewhat more so than in December. According to data from the Federal Statistical Office, sales in the wholesale sector increased by 1.6% (in real terms) between January and October. Wholesale prices rose by an annual average of 2.7%, with a slightly stronger rise in the second half of the year. According to the results of the current survey, only significantly fewer wholesalers were able to implement price increases, bringing the balance down to its lowest level since November 2016. Inventories were again assessed as too large. At the same time, and probably also in connection with the clouded business expectations, ordering activity is set to decline. Thus, for the first time since August 2016, the balance of expected orders was negative. Nonetheless, staff expansion is still planned. Between January and October 2018, the number of employees rose by 1.5%, which was weaker than in the same period of the previous year (2.7%).