Philenews

Retail Sector Outlook for 2026: Opportunities and Challenges

Published January 19, 2026, 10:22
Retail Sector Outlook for 2026: Opportunities and Challenges

2026 is expected to be a year of both opportunities and challenges for the retail sector in Cyprus. Despite recent difficulties such as the pandemic, geopolitical unrest, and inflation, the sector has demonstrated resilience and adaptability. According to the latest data, the value of retail turnover increased by 7.6% in October 2025, while volume increased by 10.1%. This indicates that consumption remains positive despite pressures on disposable income. However, there are also challenges that need to be addressed. Inflation, although declining, continues to affect the cost of living, while rising interest rates burden businesses' liquidity. In addition, labor shortages are a significant problem for the sector. Technological advancements and digital transformation offer new prospects for retail. Artificial intelligence, data analytics, and automation can improve efficiency and customer experience. Businesses that invest in these technologies will have a competitive advantage.