Retail Sector in Turkish Economy: Its Critical Importance and the Bottlenecks

By November 23, 2014 Blog No Comments

by Ümit Özlale

The increasing pace of urbanization together with an increase in the purchasing power of Turkish households in the last decade further increased the importance of the retail sector for the Turkish economy.  Figure 1 clearly shows the growing importance of the retail sector in generating domestic demand as well as contributing to the foreign trade performance.

Figure 1. Share of wholesale and retail sector in total domestic, export and net sales


Source: Entrepreneurship Information System, MoSIT (population data, the last available observation year is 2012 as of November 2014)

The retail sector’s critical importance can be seen also in Figure 2. The sector has the second largest share in GDP as of 2013. More importantly, its contribution to economic recovery after the crisis period is even more remarkable. These numbers alone show the necessity of long-term sectoral policies to ensure a sustainable growth path for the retail sector.

Figure 2. Contribution to Economic Recovery By Sectors

Share in GDP Contribution to recovery after the crisis
Year (2013) (2002) (2010)
Manufacturing %15,35 %11,3 %34,7
Wholesale and Retail %12,04 %13,1 %18,1
Transportation and Logistics %11,96 %22,8 %14,5
Construction and related act. %9,96 %3,6 %1,2


Then the critical step is to find out the policy steps to have a sustainable sectoral growth. The UMEM survey results and the interviews with the key actors in the sector point out two bottlenecks: uneducated labor force and limited brand management. While the solution to the former problem requires effective vocational training and making the retail sector be seen as a promising career path for university graduates, the latter problem requires more resources devoted to branding, design and internationalization.

Please contact Ümit Özlale for further details.