Retail sector sees improving business as inflation cools

MANILA, Philippines — The Philippine Retailers Association (PRA) said the cooling inflation is a welcome development as it expects the recovery of the industry this year, driven by the continued spending of consumers despite the high inflation.

“It’s a welcome development for us especially since for several months we’ve been experiencing a high inflation. So now, at least it’s improving,” PRA president Rosemarie Ong said on the sidelines of Outstanding Filipino Retailers Awards.

Latest data from the Philippine Statistics Authority (PSA) showed that headline inflation eased for the fourth straight month in May to 6.1 percent from 6.6 percent a month earlier.

This is the lowest inflation rate since the 5.4 percent in May last year.

The latest inflation print is within the 5.8 to 6.6 percent inflation rate projected for May by the Bangko Sentral ng Pilipinas.

“We’re looking at full recovery growth this year despite the headwinds. You know that Filipino retailers are very resilient,” Ong said.

“The people continue to spend. And what we see now, if you go to the malls, it’s like going back to pre-pandemic levels. But hopefully this will continue and will improve,” she said.

Ong said the retail sector may not see double-digit growth in sales this year, but noted that it would still register growth.

“Definitely there’ll be growth, but it’s not in the same magnitude or is in that same level as what happened in 2022 because it really ramped up in 2022,” Ong said.

The PRA official identified the food retail business and the home improvement sector as some of the retail industries that are expected to grow.

“I think home improvement is very resilient because everyone was focused on renovating or improving their homes during the pandemic,” Ong said.

However, with the ease of restrictions now, Ong also expressed optimism about the rise of revenge travel, which is also seen to generate business for the retail industry.

“For domestic tourism, I think it will help the MSMEs because if there is movement, or if there’s travel definitely a domino effect will follow, even in the retail business,” she said.

On Thursday, the PRA in partnership with the Department of Trade and Industry, held the 22nd Outstanding Filipino Retailer Awards where it recognized retailers for their pandemic resilience, sustainability and innovation.

Winners of the pandemic resiliency award are McDonald’s Philippines, Karat World and Silverworks.

For the sustainability category the winners were Silverworks, Bayo and Wilcon Depot.

Recognized retailers in the retail innovation category were Tumi, R.O.X. and Penshoppe.

Moreover, Go Negosyo founder Joey Concepcion was also awarded the 2023 PRA President’s Award.