Erratic climate threatens retail sector

CEBU, Philippines - While the retail sector enjoyed a double-digit growth in the first quarter of the year, Cebu retailers are now bracing for the worst as erratic climate patterns pose threats to the industry more than the economic movement of the country.

“The major challenge retailers are facing today is not more on economic movement, but rather on the unpredictable weather that prevents us to plan ahead, make projections, unlike before,” said Philippines Retailers Association (PRA-Cebu) chairman Jonathan Jay P. Aldeguer.

Aldeguer cited this year’s summer season, which was considered as the longest full-term summer that happened in recent years.

“The effects of global warming are much threatening to us. It’s hard to predict even in a short span of time,” Aldeguer said.

Due to the worsening climate change, commodity supplies and other retail products can not be calculated accurately, while demands largely depend on the weather including food, and fashion, among others.

Aldeguer said weather disturbances such as the “Ondoy” typhoon that devastated a huge part of the Luzon area last year created a massive impact to the entire retail industry of the country.

And as retailers face the uncertainties of what the erratic climate cycle may bring, Aldeguer said they are also closely keeping watch on the new leadership in the government. 

“Everyone is watchful and anticipating what the new administration can offer. Thus, predictions for the industry growth in the next two quarters are hazier,” Aldeguer said.

Even with these potential uncontrollable barriers for growth, Aldeguer said retail industry players maintain a guarded optimism to cater to the consumers’ interests, especially with the noticeable change in the buying trends nowadays.

Aldeguer said he hopes that tourism as well as new investments will continue to grow in the next two quarters to help buoy growth in the retail sector.

Cebu’s dynamic retail industry is fueled by the increasing number of tourists, investments especially in the Business Process Outsourcing (BPO), as well as the sustained and growing remittance of the Overseas Filipino Workers (OFWs).

Discounting the effects of the global warming, and the political leadership change, retail players in Cebu are expecting a good business year in 2010.

Still retailers are called to invest largely on modernized retail concepts, and use different channels available in promoting their products and services.

Constant application of innovation in terms of product inventory, packaging, among others are few of the many things that have to be imposed in a retail operation, as consumers’ preference are becoming much more dynamic.