The retail sector in Valletta requires a strategic solution if it is to regain the considerable ground it has lost to other shopping destinations, according to Deloitte.

Valletta, which used to enjoy a privileged position as Malta’s leading shopping destination in terms of turnover, is losing ground year on year, and outlets lost 5.4 per cent of their turnover in 2012, following an even greater reduction of 10.3 per cent the previous year.

In Sliema, almost three-quarters of outlets reported high turnovers

The figures emerged from the second edition of the Malta Retail Review undertaken by Deloitte and EMCS. The survey captured some 40 per cent of the clothing and footwear sector, which is estimated to be worth €175 million annually.

“The accumulated losses of Valletta are having a significant impact on the sector,” financial advisory leader Raphael Aloisio said, noting that restaurants, on the other hand, were seeing an eight per cent increase in patronage, according to a separate survey carried out by Deloitte.

“What we are seeing is a displacement of shoppers from Valletta to Sliema – particularly to The Point – as well as from one brand to another within Valletta.

“In Sliema, almost three-quarters of outlets reported high turnovers.

“But the increase in restaurant turnover could indicate that the future lies with an evolution of Valletta from a shopping destination to an entertainment one.”

The downturn in shopping in the capital city is being attributed to construction works and parking restrictions but EMCS director Stefano Mallia said one should not assume these were the sole causes and that tackling these issues would automatically restore normality.

Mr Aloisio appealed to other outlets to take part in the survey, saying that the greater the credibility and participation in the survey, the stronger a lobbying tool it would be for the sector.

Survey highlights

Turnover

Valletta   - 5.4% (2011: -10.3%)
Sliema    +3.2% (2011: +1.5%)
Fgura/Paola   - 6.7% (2011: +3%)
Naxxar/San Ġwann/Attard/Iklin    +2.7% (2011: +5.7%)
Ħamrun/Qormi/Others    +8.4% (2011: +0.3%)

•61 per cent of survey participants reported higher turnover in 2012.
•Larger retail outlets with turnover in excess of €1 million per annum increased turnover by 2.1 per cent, whereas smaller shops registered a decline of 0.2 per cent, perhaps reflecting the better “shopping experience”.
•Franchises saw a decrease of 0.2 per cent while own brands saw an increase of 5.1 per cent.
•High street outlets saw a marginal increase of 0.1 per cent, while malls fared better, seeing an increase of 1.8 per cent.