11 November 2022. The new issue of the long-term study "Shopping tourism" of the Institute of Retail Management at the University of St.Gallen (IRM-HSG) illuminates the buying behaviour of Swiss shopping tourists in neighbouring foreign countries. The focus of the study is on the five retail trade sectors food, drug store, clothing, sport and furnishing.
Online growth cannot compensate for losses in shops
Purchases from bricks-and-mortar outlets abroad declined. Since 2017, it has declined for all sectors by more than 10%. For example, the average amount per purchase in outlets abroad fell from CHF 246 to CHF 216. This was exacerbated by the fact that buying abroad occurs less often, namely only 4.8 times. This was also a decline compared to 2017. Purchasing frequency then was still 5.2 times. By contrast, more consumers abroad are shopping online compared to 2017. Little has changed per online purchase. Purchasing frequency and the amount each person spends have remained the same. However, compared to 2017, far more shoppers buy online today. In 2022, 41.9% of consumers bought online abroad whereas in 2017 it was only 37%. Hence, online shopping tourism has increased by a good 20% to CHF 1.45 billion since 2017.
Value for money remains the main driver of shopping tourism, but high inflation abroad is a disincentive. As a result, every fifth shopping guest had second thoughts due to the inflation-related price increases in neighbouring foreign countries. Many are once again buying to an increased extent in Switzerland.
Value added tax limit of CHF 50 and customs clearance impeding shopping tourism
The restriction demanded on value added tax reimbursement to purchases up to CHF 50 could reduce bricks-and-mortar shopping tourism in neighbouring foreign countries by an average of 32.6%. Consequently, introduction of a limit of CHF 50 would result in a reduction of shopping tourism amounting to CHF 2.27 billion. Among the many other obstacles, such as waiting times at borders, overcrowded trains or the risk of meeting friends and acquaintances, shopping tourists in particular criticised the laborious customs clearance.
Marked differences between sectors
The decline in bricks-and-mortar shopping tourism exceeded the increase in online shopping tourism in four of five sectors. This was particularly striking in the clothing sector, where the overall volume has fallen by about CHF 300 million since 2017. In the furnishing sector, online shopping tourism admittedly rose the most with about CHF 123 million, but was exceeded by the decline in bricks-and-mortar shopping tourism at about CHF 180 million. Only the sporting articles sector suffered a decline in both the bricks-and-mortar shopping tourism of about CHF 159 million as well as in online shopping tourism of about CHF 21 million.
Information about the study
Prof. Dr. Thomas Rudolph, Christopher Schraml, Christine Otto and Nora Kralle at the Institute of Retail Management of the University of St.Gallen (IRM-HSG) conducted an online survey of over 3000 shopping tourists from Switzerland. The study illuminates the scale of shopping tourism both in brick-and-mortar outlets as well as online, changes in behaviour since 2017 and the development of individual sectors. The data collection received financial support from Handelsverband.Swiss, the Swiss Retail Federation and ALDI SUISSE AG.
More information: www.handelsliteratur-hsg.ch
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