Despite remaining in negative territory, the total accumulated turnover of Portuguese businesses recorded a slight upturn last September, largely due to national tourism and the rentrée. This is the main conclusion of the most recent report on the evolution of business transactions in Portugal during the pandemic period prepared by REDUNIQ Insights.
In percentage terms, total turnover up to September was down 20% on the same period last year, while the amount invoiced by businesses last month was down 9% compared to the same month in 2019.
After approximately 3 months of deconfinement, July still saw losses of 20% year on year. August and September, on the other hand, based on some tourism and the effects of the "Great Rentrée", led to a recovery to a new level with losses of less than 10% (compared to 2019).
According to the document, although the indicators for September appear to be "positive", the figures cannot be taken as a sure indicator that the recovery trend will prevail. On the one hand, it is to be expected that the worsening of the health crisis will once again condition consumer behaviour, and on the other, we must be alert to the deepening impacts of an economic crisis that has been announced but has not yet been reflected in the figures analysed in the document.
Total Billing Evolution 2020/2019 (Fortnights)
Recovery is the word that can also be applied to the evolution of the number of transactions at national level. With a year-on-year variation of less than one percentage point since 23 August - the latest records, which cover the period between 6 and 19 September, indicate a year-on-year variation of minus 0.42%. In addition, the new REDUNIQ Insights report also shows that although the Portuguese are consuming more often, they are spending less on each purchase, with the average value per transaction being 33.50€.
Evolution of the Total Number of Transactions 2020/2019 (Fortnights)
Returning to billing, when comparing the billing levels of domestic and foreign cards, the data in this report shows that between August and September, Portuguese consumption exceeded the billing recorded in the same period of 2019, while foreign billing fell by 50%.
These results reflect what was the national reality during the summer period: the strong promotion of Portugal as a tourist destination for the Portuguese and, at the same time, the drop in foreign consumption due to measures to contain the spread of the virus, namely air traffic restrictions. In contrast to 2019, in the months of June, July and August, there were around 1 million fewer trips abroad (by plane) by Portuguese people, who will have consumed in Portugal.
However, if we analyse the total accumulated turnover up to September, we see a very similar scenario, with a fall of 9% in domestic consumption, contrasting with a fall of more than 55% in foreign consumption.
Monthly Evolution of National and Foreign Invoicing 2020/2019 (Year-on-Year)
Geographically speaking, the districts with the highest tourist activity, such as Lisbon, Porto, Faro and the autonomous regions of the Azores and Madeira, were the areas where the decrease in foreign demand was felt the most, despite recording better results during the summer months.
In September alone, Lisbon saw falls of around 24% year-on-year, while Faro, Madeira Porto and the Azores saw falls of 20%, 20%, 16% and 14%, respectively. In almost all the other districts, the changes seen in September 2020 compared to the same period in 2019 are already less than 10%, in several cases even less than 5%.
Total Turnover by District 2020/2019 (Year-on-Year)
In sectoral terms, and despite the reduction in consumption due to the pandemic, the report shows that from January to September the pharmacy, traditional food retail and household appliances and technology sectors performed better than in the same period last year, with 45%, 31% and 7% more turnover, respectively.
In contrast to these performances are the hotel business (-64%), fashion (-37%), and perfumery (-35%). In certain categories, such as hairdressers, pharmacies and traditional food retail, this improvement in turnover was due, on the one hand, to an increase in the number of customers. automatic payment terminals in the system - retailers' response to consumers' fear of using physical cash - and, on the other hand, to what the document prepared by REDUNIQ Insights considers to be a migration from physical cash payments to electronic payments - first and foremost due to the democratisation of the Contactless.
Evolution of Turnover by Sector of Activity 2020/2019 (Year-on-Year Changes)
"Star" of this year 2020 due to the sharp growth in its use and weight in the total turnover of Portuguese businesses, the Contactless This latest report unsurprisingly highlights the fact that this means of payment accounted for 28% of total payments in August this year. In terms of use, this payment method saw an increase of 19% between July and August, with an average growth rate of 18.05%. As for the average ticket (average value per payment) of contactless transactions, more than 50% are made up to 15€, although it is possible to make contactless payments of up to €50.
Evolution of Contactless Billing 2020/2019 - Monthly Variation and Average Growth Rate (AGR)
In line with the growth of this technology, the REDUNIQ offers traders a Contactless POS solution which, in addition to enabling faster transactions and reducing the risk of the virus spreading (card/smartphone/wearables and terminal do not touch throughout the process), brings benefits to the merchant in the form of reduced cash handling costs, higher average transactions and the guarantee that the payment is actually made.
During the entire transaction process, security is completely guaranteed, since REDUNIQ is the only brand in Portugal with the PCI DSS certificationThis ensures that the entire Contactless payment is truly safe in all its dimensions.
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