Economy eyes wedding stimulus in Turkey
Güncelleme Tarihi:
by Özgül Öztürk - Referans
Oluşturulma Tarihi: Mayıs 04, 2009 00:00
ISTANBUL - The government’s tax cuts may have helped various industries, however many others are waiting for the wedding season to open. Each year, hundreds of thousands of couples gett married in Turkey, stimulating the industries from furniture to wedding gowns and jewelry
From furniture to durable goods, from gold to invitation cards, many Turkish companies have pinned their hopes on the approaching "wedding season," betting that the spending of couples and their families will stimulate business.
Between 700,000 and 800,000 couples get married each year in Turkey. Various companies, including those operating in furniture, gold, wedding gowns, invitation cards and venues are expecting to shore up their business as weddings increase during summer months. To-be-wed couples have already started shopping, and noting their purchasing trends, sector representatives say this year the tendency is overwhelmingly toward cheaper products.
The first thing that comes to mind in weddings is the wedding gown. The wedding gown industry in Turkey stands at an annual volume of between 300 million and 350 million Turkish Liras. The sector has stepped into 2009 with the low-spiritedness carried over from 2008, the year of global crisis. Wedding gown prices did not see increases this year, but as many materials used in making gowns are imported, the appreciation of the U.S. dollar and the euro against the lira has had a negative impact. "Producers have also been negatively affected from the increase in energy costs," said Ermiya Akay, president of the Istanbul Wedding Gown Industrialists and Exporters Association. "This year, producers are offering their products without changing the price tags."
Despite increased sales this year, profit margins have declined, Akay said. "Low-income people generally spend from 400 to 500 liras on gowns, while many choose to hire."
The economic slowdown has also reflected in gold sales. For customary "gold days," organized by groups of housewives to raise the household’s income, money is being used nowadays, as gold prices as high as 45 liras per gram are pressing on family budgets. As their sales fall, jewelers are also pinning hopes on the wedding industry. Despite a dimmer season compared to last year, citizens did not abandon gold altogether, according to Mehmet Ali Yıldırımtürk, owner of the Mehmet Altın Kuyumcusu, a jewelry shop at Istanbul’s Kapalıçarşı. The price of a quarter gold coin has increased to 80 liras and Yıldırımtürk, who is the first entrepreneur in Turkey to "hire" gold, plans to issue "half a quarter gold coins."
Slashing prices
Business volume of wedding halls especially in rural areas and poor districts has decreased 5 percent compared to last year. Under pressure, many wedding hall operators have begun hiring their spaces at cheaper prices than last year’s.
"In poor districts prices have fallen, while some halls have increased the number of services," said Ahmet Batmaz, the secretary-general of Istanbul Meeting and Wedding Hall Operators Chamber. "This year, the cheapest rental price for weddings will be between 1,300 and 1,400 liras," said Batmaz. Invitation card producers are also observing a decrease in the number of customers and the number of cards produced per wedding. Such cards are sold for prices varying between 10 liras and 500 liras per 100 units, but demand has fallen drastically this year. "Last year, I was receiving at least five orders each day," said Celal Girgin, owner of Girgin Davetiye, an invitation card company. "This year we are reaching this number in two or three days. People also choose cheaper cards."
Furniture producers are also eyeing the wedding season. Couples who wanted to benefit from the temporary cut in value added tax, or VAT, have already made their orders. Last year the furniture market reached a volume of $6 billion, and this year the sector has been stimulated by the 10 percent cut in VAT, said Nazif Türkoğlu, president of the Association of Turkish Furniture Manufacturers, or MOSDER.
Between 700,000 and 800,000 couples get married each year in Turkey. Various companies, including those operating in furniture, gold, wedding gowns, invitation cards and venues are expecting to shore up their business as weddings increase during summer months. To-be-wed couples have already started shopping, and noting their purchasing trends, sector representatives say this year the tendency is overwhelmingly toward cheaper products.
The first thing that comes to mind in weddings is the wedding gown. The wedding gown industry in Turkey stands at an annual volume of between 300 million and 350 million Turkish Liras. The sector has stepped into 2009 with the low-spiritedness carried over from 2008, the year of global crisis. Wedding gown prices did not see increases this year, but as many materials used in making gowns are imported, the appreciation of the U.S. dollar and the euro against the lira has had a negative impact. "Producers have also been negatively affected from the increase in energy costs," said Ermiya Akay, president of the Istanbul Wedding Gown Industrialists and Exporters Association. "This year, producers are offering their products without changing the price tags."
Despite increased sales this year, profit margins have declined, Akay said. "Low-income people generally spend from 400 to 500 liras on gowns, while many choose to hire."
The economic slowdown has also reflected in gold sales. For customary "gold days," organized by groups of housewives to raise the household’s income, money is being used nowadays, as gold prices as high as 45 liras per gram are pressing on family budgets. As their sales fall, jewelers are also pinning hopes on the wedding industry. Despite a dimmer season compared to last year, citizens did not abandon gold altogether, according to Mehmet Ali Yıldırımtürk, owner of the Mehmet Altın Kuyumcusu, a jewelry shop at Istanbul’s Kapalıçarşı. The price of a quarter gold coin has increased to 80 liras and Yıldırımtürk, who is the first entrepreneur in Turkey to "hire" gold, plans to issue "half a quarter gold coins."
Slashing prices
Business volume of wedding halls especially in rural areas and poor districts has decreased 5 percent compared to last year. Under pressure, many wedding hall operators have begun hiring their spaces at cheaper prices than last year’s.
"In poor districts prices have fallen, while some halls have increased the number of services," said Ahmet Batmaz, the secretary-general of Istanbul Meeting and Wedding Hall Operators Chamber. "This year, the cheapest rental price for weddings will be between 1,300 and 1,400 liras," said Batmaz. Invitation card producers are also observing a decrease in the number of customers and the number of cards produced per wedding. Such cards are sold for prices varying between 10 liras and 500 liras per 100 units, but demand has fallen drastically this year. "Last year, I was receiving at least five orders each day," said Celal Girgin, owner of Girgin Davetiye, an invitation card company. "This year we are reaching this number in two or three days. People also choose cheaper cards."
Furniture producers are also eyeing the wedding season. Couples who wanted to benefit from the temporary cut in value added tax, or VAT, have already made their orders. Last year the furniture market reached a volume of $6 billion, and this year the sector has been stimulated by the 10 percent cut in VAT, said Nazif Türkoğlu, president of the Association of Turkish Furniture Manufacturers, or MOSDER.