How can I sell my startup software

Tyrolean startup software enables customers to have their own television programs

“In the Corona year 2020, the expenses of Austrians fell by -8.2 percent. For 2021 we expect a slight recovery of +0.5 percent in real terms, but we will probably not reach the pre-crisis level again until 2024. In total, the Covid lockdowns cost us lost spending of 39 billion euros, ”says Rainer Will, managing director of the trade association, summarizing the key results. The failures for 2021 are also included here. The Easter calm in the east of the country alone was accompanied by a loss in sales of 1.95 billion euros, as the brutkasten has already reported.

Retail sales with real sales decline of 1.3 percent

Specifically, private household expenditures fell from 206.5 billion euros in the previous year to 192.5 billion euros. This corresponds to a minus of -6.8 percent, which, however, adjusted for inflation, climbs to the -8.2 percent just mentioned. The service sector and motor vehicles were hardest hit (-15.1%). The retail sector had to cope with a real drop in sales of around -1.3 percent to 67.6 billion euros. "At first glance, this number doesn't seem so dramatic," emphasizes Rainer Will in the course of the study presentation. However, if you look at the developments in detail, then the true extent of the damage becomes clear.

Fashion, jewelry and wholesalers with losses

In a sector comparison, the stationary fashion retailer posted the greatest losses in 2020 with a drop in sales of minus 24 percent. Winter sports equipment, jewelry and shoe retailers also recorded declines of more than minus 15 percent. And retailers in tourist regions and wholesalers supplying the catering trade also had little to smile about last year. In some cases, these had to cope with total failures, which brought numerous companies to the brink of survivability. In the next two years - this is forecast by the trade association - between 5,000 and 10,000 stores will have to close.

Companies that rely on online shops have been able to compensate for some of their failures in stationary retail, but - according to Rainer Will - mainly web shops from third countries such as Amazon have benefited.

Dynamic mail order business

However, it has been shown that digitization has received a new boost in the Corona times. "Online retailing once again gained in importance last year, and compared to 2019, the growth dynamic has increased as expected. The sales channel generated a whopping 17 percent higher private spending during the pandemic. This increases the eCommerce share of total retail sales to a new record of 11.2 percent, ”said Will. In 2019, the share was 9.6 percent. In addition, in addition to clothing and shoes (31.2%), electrical appliances (26.3%) and books (46.8%), products are now also being bought online that were previously preferred to be bought in stationary stores. “The current industry radar for 2020 shows substantial increases in items such as art antiques (+ 75%), green space products (+ 45%), drugstore goods (+ 36%) and furnishings (+ 40%). In the grocery trade, online shopping is still a niche affair despite massive investments, but the growth dynamic is also considerable at + 46%, ”says study author Andreas Kreutzer from market analysis.

KEP market is growing considerably - Amazon benefits

The so-called CEP market (courier, express and parcel services) also benefited from the corona crisis. The parcel volume in the B2C area increased by 27 percent to 139 million items. In 2019 there were still 109 million pieces. Partial deliveries and returns are also likely to have had an impact on the increasing number. However, the parcel value has fallen by eight percent, as many products with a lower value were also ordered online that would probably have been bought in stationary stores before the corona pandemic.

But even if Austrians are buying more and more online, there is a downer to complain about. The biggest beneficiaries of the corona-related shutdowns were not the domestic online retailers, but global shipping giants - above all Amazon. Only every third package is ordered from domestic web shops; the share of foreign online retailers is 64 percent. The flood of parcels from China is also great, which is why Will is happy that the end of the 22 euro exemption limit for parcel deliveries from third countries, which has long been demanded, is now being implemented. “The end of the 22 euro exemption limit on July 1, 2021 is overdue. With this, the European Union will finally close a 7 billion euro tax loophole for Asian online retailers, ”says Will happily.

Forecast 2021: a climate of confidence, but a rocky road

The fact that business hours have returned to normal since this week and that the catering and hotel industry have reopened their doors also gives the retail industry a positive feeling. It is hoped that the increasing number of visitors will stimulate impulse purchases again and that compared to the previous sales developments since the opening of the trade, one can generate an additional turnover of 100 million euros per week. Provided that there is no fourth lockdown, because "the same answers that were given in the course of the first corona wave to contain the pandemic may no longer be given now and in the future," emphasizes Will.

In order for the economic restart to be successful, the trade association sees an urgent need for action in four areas in particular:

  • Creation of equal and fair competitive conditions in the EU (fair commerce)
  • Reduction of non-wage labor costs
  • Abolition of the lease fee
  • Return from the 20m2 to the 10m2 per customer rule in retail