Cebu retail sector expects flat growth in 2026

CEBU, Philippines — Cebu’s retail sector is heading into 2026 with a guarded, mostly flat outlook as weak consumer demand, delayed state spending, and policy uncertainty continue to weigh on sales.

“The mood is still wait and see,” said Robert Go, spokesman for the Philippine Retailers Association’s Cebu chapter. “No one expects strong growth early in 2026.”

According to Go, 2025 closed far below expectations after sales fell sharply from September through December, a period that usually delivers the biggest gains.

Spending on non-essential goods such as clothing, home items and personal care products declined, while food sales held steady, Go said.

December, typically lifted by bonuses and holiday shopping, saw demand pick up only in the final three days before Christmas. As a result, full-year sales were largely unchanged from 2024.

Tight household budgets have limited spending, with even farmers and fisherfolk cutting back, Go said.

The slowdown has also hurt business confidence, with no major new retail openings in Cebu as investors take a defensive stance amid concerns over corruption and unclear policies.

Challenges, opportunities

Looking ahead, Go — founder and chief executive officer of Prince Retail Group, which operates Prince Hypermart — said risks for 2026 include lower government spending due to budget delays, stalled infrastructure projects and weak consumer cash flow.

A softer peso could also raise prices for manufactured goods as higher costs are passed on through smaller pack sizes or higher shelf prices.

Relief could come in the second half of the year 2026 if budget issues are settled, infrastructure work resumes and subsidies return, he added.

Retailers are also looking to benefit from a series of regional meetings linked to Asean events, many of which will be held in Cebu. These include tourism-related gatherings early in the year and major business and leaders’ meetings later on.

“Hotels and tourism may improve and create a ripple effect,” Go said, adding that stronger growth in nearby economies could support holiday travel and modest gains in retail demand. — (FREEMAN)