Retail Sales Continue to Slide, Especially in Jerusalem

Receipts decline 12.7% nationwide, 21.5% in capital in just five days, according to research firm.

Emil Salman

Many merchants seemed to have hoped that Israelis would adapt to the latest spate of unrest and resume their regular spending habits, but sales have continued to slide at shopping malls, cafes and restaurants, the Retail Information System Israel research firm has reported.

Although consumer spending frequently declines right after the fall Jewish holidays, over the past five days retail sales have dropped by 12.7%. This compares to a drop of less than 12% in the two weeks since the beginning of the wave of terrorism . The drop is countrywide and includes for example, Tel Aviv, which saw a stabbing attack earlier in the month but has so far been spared further terror attacks. Retail sales in Tel Aviv dropped 11.3% over the past five days. In the southern region, which includes Be’er Sheva, the scene of a terror attack at the city’s central bus station Sunday evening, sales were off 12% over the last five days and down 10% over the past two weeks.

Retail sales volumes in Jerusalem, which in large measure has borne the brunt of the recent attacks, have been more sharply lower. Over the past two weeks, sales per square meter of retail space in the capital declined by 13.4%. The drop was particularly stark over the past five days, at 21.5% said RIS, according to a survey of retail establishments. The comparisons are based on sales data between October 6 and October 19 and over the past five days, compared to average daily sales per square meter in the first half of this year.

“At the beginning of the wave of terror, there were a lot of people in Jerusalem for the space conference that drew more than 2,000 people and also tourists in the city who had reserved accommodations before the escalation,” said Noam Rizi, who is a partner in the Adom, Lavan and Colony restaurants in the city. He was referring to the 66th International Astronautical Congress, which took place from October 12 through October 16 in the capital.

“In the past several days, the conference has ended, the tourists have left the city and others have not come to replace them, and the drop in sales at cafes and restaurants has worsened to 30% to 70%,” Rizi said. Those businesses that normally attract customers on a regular basis throughout the day have been less hurt than establishments that are seen as places of entertainment and culture, he added.

If sales at the Tzomet Sfarim bookstore chain can serve as a barometer, on a national basis they are down 15%. But the situation is particularly aggravating for businesses in Jerusalem, Rizi said.

“Just as Israelis get angry when performers from abroad cancel their visits to Israel due to the security situation, it also irks people in Jerusalem that people from outside of Jerusalem stay away from the city. We still haven’t recovered from the summer of 2014,” he said. “Businesses are still paying off their loans from Protective Edge and are now in a rather catatonic situation,” he said, referring to the war in the Gaza Strip.

“I’m talking a drop of 70% to 80% in sales,” said another restaurateur, Michael Katz, the chef at Trattoria Haba at the entrance to Jerusalem’s normally bustling Mahaneh Yehuda open-air market.

“If we routinely get around 500 customers a day, now we’re getting 50 to 60. And even those who do come aren’t sitting down for a full breakfast but instead are getting some coffee and a small croissant and running,” Katz said.