As Poland's economy has grown, more luxury brands have invested in the country. But a new bill backed by the Catholic Church could knock its progress back.
Zara store at the Manufaktura mall in Lodz, Poland | Source: Shutterstock
BY KATI CHITRAKORN
WARSAW, Poland — Poland’s lawmakers have approved a law restricting Sunday shopping from next year, as the government pushes ahead with what it sees as a return to Roman Catholic values.
The legislation, which passed by a vote of 254 to 156 on Friday, will gradually phase out shopping on Sundays in order to provide workers with a day of rest and allowing more time to spend with their families. The bill must now be signed into law by the Polish parliament and president Andrzej Duda.
Under the new proposal, retail businesses will be required to close for two Sundays a month from March 2018, gradually leading to opening just one Sunday a month in 2019, followed by an entire shutdown of stores on Sunday by 2020.
Smaller businesses, however, are exempt from the new regulations. “Small shops that are run by an owner, alongside one or two additional employees, will be able to remain open, so long as the owner is selling the products themselves,” explained Michal Dybula, chief economist of Central and Eastern Europe at BNP Paribas, noting that shopping at petrol and railway stations and airports will also be allowed.
Critics warned that the move would negatively affect Poland's economy, the eighth largest in the European Union in real GDP terms, where domestic consumption is a main driver of economic growth. Poland’s economy grew 4.7 percent in the third quarter from a year earlier, the biggest increase since 2011. “We can expect a negative impact on the overall volume of private consumption in response to this law,” said Dybula.
Poland’s luxury market is still in its infancy compared to established markets like France or Italy. However, its broader fashion market has been performing well, standing out from its Eastern European neighbours. BMI forecasted that the Polish consumer will spend 44.7 billion złoty ($11.9 billion) on clothing and footwear this year, with a year-on-year increase of 4.3 percent, reaching 54 billion złoty ($15.2 billion) by 2021.
Warsaw is home to a number of upscale department stores and malls, such as Vitkac, which houses brands like Louis Vuitton, Saint Laurent, Bottega Veneta and Gucci. Labels like Michael Kors and Max Mara have also recently moved into the country, setting up shop at Galeria Mokotów. Beyond the capital, the popular Likus Concept Store has outposts in Krakow and Wroclaw, stocking brands including Commes des Garçons, Rick Owens and Acne Studios. Meanwhile, the Manufaktura mall, in Łódź, is home to fast-fashion labels like Zara.
Even Condé Nast decided to penetrate the Polish market, launching Vogue Poland in June 2017 — a significant decision for the publisher, which has been cautious when it comes to rolling out international editions compared to its competitors.
Department stores and malls will be hardest hit by the new regulations, said Dybula. “A lot of the turnover in these shops is achieved on Sunday.” The ruling is counter-current to the slow liberalisation of Sunday shopping hours throughout Europe, where retailers face increasing pressure from a boom in online shopping. France passed a law to open up Sunday shopping in 2015. Hungary, too, scrapped a ban on Sunday trade that had been in effect for little over a year, in 2016, because it proved unpopular.
Dybula noted it will take at least five years to see the effects of the new restrictions. "The law is being implemented in a relatively gradual way," he said. "Perhaps over time, the shopping behaviour of Polish consumers will change and they will spend more on Saturdays or the weekdays. But will that help to compensate for the loss of Sunday shopping? I’m doubtful.”