Portuguese Shops Sold Less Food in August Than a Year Earlier, the First Fall Since 2023, as Homeware Sales Rose 10 Percent

Portuguese shops sold less food and drink in August than a year earlier once price rises are stripped out, the first annual fall since December 2023. Sales volumes of food, drink and tobacco slipped 0.3 percent, while sales of non-food goods grew 4.2 percent, led by household goods, according to the monthly trade indices published on 30 September by the Instituto Nacional de Estatística (INE, Statistics Portugal).

Retail as a whole still grew. Sales by retailers (excluding cars and motorcycles) were 2.4 percent higher in volume than in August 2025, a touch slower than July's 2.6 percent. Food was the drag: its growth rate fell 2.5 percentage points in a month, from 2.2 percent in July.

Small food shops are hit hardest

The split inside the food figures is sharp. Supermarkets, hypermarkets and other non-specialised stores selling mainly food still sold 0.5 percent more than a year earlier. Specialised food shops, the category that covers butchers, fishmongers, bakeries and greengrocers, sold 6.5 percent less.

That was the fourth monthly fall in a row for specialised food shops (down 3.3 percent in May, 0.8 percent in June and 5.0 percent in July), and the steepest since March 2021, according to the series in INE's data tables, which run back to 2006. Jobs are following: employment in specialised food shops was 3.8 percent lower than a year earlier, the biggest drop since March 2021.

Across all food retail, employment was down 0.9 percent, and total pay rose just 1.2 percent, against 5.8 percent across the trade sector as a whole.

Where the money went instead

Non-food retail had a strong month. Year-on-year volume growth in August, from INE's data tables:

• Household goods (furniture, appliances, hardware and similar): up 10.1 percent, the fourth double-digit month this year.
• Pharmacy, medical, cosmetic and hygiene products: up 7.4 percent.
• Mail order and online sales: up 7.0 percent.
• Clothing, footwear and leather goods: up 5.9 percent.
• Computers, telecoms equipment, books and similar in specialised shops: up 4.0 percent.
• Motor fuel: down 5.6 percent.

Excluding fuel, non-food sales grew 6.3 percent and overall retail 3.3 percent.

Prices explain much of the cash growth

The headline figures are in volume terms: INE deflates turnover and adjusts it for calendar and seasonal effects, so a rise means more goods sold, not simply higher prices. In cash terms, retail turnover rose 6.5 percent in August. The gap of roughly four points between that and the 2.4 percent volume growth is, broadly, what rising prices added to the bill.

Compared with July, retail volumes fell 0.7 percent, after a 0.1 percent dip the month before.

The wider trade sector

Taking in wholesalers and the motor trade, total trade turnover grew 1.7 percent in volume, up from 1.5 percent in July. Wholesale sales rose 1.5 percent after falling 0.3 percent the month before. The car and motorcycle trade, including repairs, slowed sharply to 0.8 percent growth from 4.1 percent.

Trade employment was 0.9 percent higher than a year earlier, total pay rose 5.8 percent and hours worked 1.4 percent (calendar-adjusted). The employment and pay figures come from the monthly salary returns firms file with Segurança Social (Social Security); turnover and hours come from INE's own monthly survey, which had an 89.2 percent response rate this time (93.2 percent a year earlier). INE revises the two previous months with each release, so the June and July figures are still provisional.

What it means

The figures do not say whether households are eating less or simply buying food more cheaply. What they do show is that, in volume, spending on food has stopped growing, while spending on the home, health and beauty, and online orders keeps rising. Within food, the money that is still being spent is going to the supermarkets rather than to the neighbourhood butcher, baker and greengrocer, and those smaller shops are now employing fewer people.

INE publishes the September figures on 2 November.