Expectations for Christmas season in Finland ‘slightly better than last year’

Business and consumer expectations for the forthcoming Christmas period in Finland are slightly better this year, compared to last, according to trade association Kaupan liitto.

According to the trade body, Finnish consumers now have more faith in the domestic economy, while expectations among specialty and consumer goods traders has also improved.

This year, however, Christmas shopping is expected to be burdened by a tightening of value added tax rates, scheduled to come into effect just before the Christmas season, which is likely to eat into the purchasing power of consumers.

“The tightening of value-added taxation has been a big blow to the domestic specialty and consumer goods trade, which competes for customers with foreign players,” commented Jaana Kurjenoja, chief economist, Kaupan liitto.

Earlier start

The group also added that the Christmas shopping season typically commences in mid-November, when global campaigns around events such as ‘Black Friday’ begin to resonate with consumers – indeed, November sales in home appliances have already surpassed those of December.

This is largely being driven by a surge in online shopping, largely from overseas players, which is prompting shoppers to make purchases earlier.

“Monitoring store website visits shows that November’s various global campaigns draw Finns to foreign online stores and marketplaces, while in December, online visits are more focused on domestic stores,” Kurjenoja added.

Traditional retail

December, however, remains the largest month for traditional retail sales in Finland, particularly for groceries.

December grocery sales alone rise about 20% above the yearly monthly average, although December’s share of grocery sales has declined over the past decade.

In 2023, Finnish retailers reported around €9.7 billion in net sales for November and December, averaging €3,440 per household. However, most of this spending went to regular, non-seasonal items, with holiday-specific purchases estimated at only €214 per household.

“Consumers have a great opportunity to support Finland’s employment and economy during Christmas by making purchases from companies operating in the country,” said Kurjenoja. Read more here.