Gaza War Takes Big Toll on Israeli Retailing

Credit-card purchases dropped 18% in first week of Protective Edge. Decline in number of Israeli Arabs shopping in Jewish-area malls.

Mamilla Mall, in Jerusalem. April 9, 2014.
Mamilla Mall, in Jerusalem. April 9, 2014.Credit: Emil Salman

The rockets being fired at Israel from the Gaza Strip are taking a heavy toll on Israeli retailing, according to figures on credit-card purchases for last week.

Credit-card purchases throughout Israel were down 17.7% by shekel volume in the first week of Operation Protective Edge, compared to the average level in June, Shva, a clearing company joined owned by Israel’s banks, said Sunday.

Some of that decline was probably due to an increase in cash spending. Shva reported a 13% rise in withdrawals from automated teller machines. But Shva said people typically stock up on cash during security crises, rather than spending it.

Meanwhile, shopping centers in the Tel Aviv area were largely empty on Friday, including at Dizengoff Center, Azrieli Center, the Tel Aviv Port and Herzliya’s Seven Stars Mall. The Tel Aviv municipality opted not to enforce the new ban on Sabbath openings by mini-marts and kiosks, officials said.

Thursday’s scheduled performance by Neil Young in Tel Aviv’s Yarkon Park was canceled by police who cited concerns about protecting the audience from rockets.

“Friday was even quieter than in precious days. People are apparently looking for more secure places,” said Mica Sol, who manages two restaurants, Boya and Yulia, at the Tel Aviv Port.”I would say only about a fifth the usual number of people who comes on Fridays to the port turned up.”

On Friday night Sol closed one of the restaurants, directing diners to the open one. “There’s no logic in operating two nearly empty restaurants. Electricity alone in the summer costs 1,200 shekels ($350) a day,” he said.

Azrieli Malls CEO Arnon Toren said traffic at the company’s flagship Azrieli Center in Tel Aviv was down 30%. It was about the same at its malls in the Tel Aviv suburbs of Givatayim, Ramat Gan and Holon, while in the company’s properties in the south, traffic was down 40%, he said.

Stores selling necessities were suffering less of a downturn, said Chai Galis, VP of Big Shopping Centers. “At stores selling nonessentials, there’s been a decline in sales of tens of percent, but people are continuing to buy at drugstores and supermarkets,” he said. “The minute there’s a night of quiet, people leave their homes – until the sirens start up again.”

The owner of the 18-store Zebra chain of clothing shops, Pini Partok, said sales were down 30% on Friday from a week before. “We’re feeling it all over the country,” he said, but added that the extent of the decline varied considerably from store to store.

In Be’er Sheva, Ashkelon and Ashdod, which have felt the brunt of the rocket fire, sales were down 60% on Friday from the week before, he said. Further north, in Rishon Letzion and Rehovot, sales were down by a much more moderate 15%, and in Zebra’s stores in Haifa, Kiryat Ata and Carmiel, which have had only a few rocket sirens, the decline was 10%.

Toren and Partok both said they detected a steep decline in the number of Israeli Arabs shopping in their respective malls. “I guess there is a psychological element behind this. Just like Jews don’t go for hummus in [the mainly Arab town of] Abu Ghosh” during tense periods, Arab are less likely to go to shopping malls in Jewish towns, Toren said.

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