The guest on “Tuesday Meetings with Top Executives” is BMD Board Chairman Sinan Öncel: “We may see sunny days very soon”
Altınbaş University hosts prominent figures who have achieved significant success in various fields at its “Tuesday Meetings with Leaders.” This month’s guest at the event, moderated by Prof. Dr. Dicle Yurdakul, Director of the University’s Continuing Education Center and Marketing Director, was Sinan Öncel, Chairman of the Board of Directors of the United Brands Association (BMD) and Twigy. The meeting was attended by our Rector, Prof. Dr. Cemal İbiş; our Vice Rector, Prof. Dr. Ali Argun Karacabey; and our General Secretary, Selçuk Uysaler, as well as faculty members and students. Sharing his experiences in the business world during the event, Öncel noted that he founded his own company at the age of 23, stating, “I definitely worked somewhere during my university years. I strongly recommend that you work somewhere. No matter where you work, I want to advise you to work somewhere. The experience I gained during those years has provided me with significant benefits in my life even today. I especially want to emphasize this point.”
“There’s a downturn in the ready-to-wear sector”
Noting that in addition to serving as Chairman of the Board at BMD and Twigy, he has also been a Board Member at Fenerbahçe Football A.Ş. for approximately six months, Öncel said, “A lot has happened in retail since the pandemic. What we went through during the pandemic feels like it was so long ago. It feels as if we never experienced it, but while we expected to face immense challenges, we actually didn’t encounter that many difficulties while we were closed. The biggest gain from the pandemic was the growth of e-commerce. Investments in e-commerce increased significantly. Following that, there was a major rebound in tourism. People shopped not out of a sense of revenge, but rather as a form of ‘revenge shopping.’ However, since then, coupled with rising costs due to inflation and a contraction in demand, we have faced a very serious bottleneck and hardship over the past 1.5 years, and that continues to this day. There has been a major contraction in ready-to-wear clothing sales. The inflation data confirms this. With inflation around 9%, ready-to-wear clothing inflation is actually contributing significantly to overall inflation,” he said.
“War broke out just as we were expecting expansion”
Noting that the ready-to-wear sector accounts for a significant portion of overall inflation, Öncel continued:
“This is starting to squeeze the leading brands in the retail sector. We’re in a pretty tight spot. Unfortunately, just as we were expecting some expansion, the outbreak of the Iran War has caused both growth expectations to decline and inflation expectations to rise. There is an expectation that interest rates will rise. So, just as we were asking ourselves, ‘Will we get a breather?’ we are actually seeing another setback. Turkey’s inflation expectations have been updated in that sense. Of course, the annual expectation is moving upward.
We are already facing significant contractions, particularly in terms of consumption. We share the surveys we conduct every month on our website, so those who are curious can visit and see them there. There is a continuous contraction. In other words, January, February, and March—each month is narrower than the one before it.”
A significant drop in tourist spending
Noting that there is also a serious contraction in fast-moving consumer goods—the engine of the economy—Öncel added, “While tourist spending accounted for around 10–11% of total credit card payments two years ago, it has now dropped to around 4%. The share of tourist spending in total card-based spending is rapidly shrinking and declining. That’s why, as I mentioned, one of the main reasons for the current tight situation is the absence of tourist spending—and most importantly, the spending of domestic residents using credit cards. In recent months, spending by residents abroad—specifically those who come to Turkey to spend—has surpassed the spending of residents abroad. Consequently, retail spending abroad has now exceeded spending by foreigners within Turkey. Everyone who has the opportunity is shopping abroad. They are either waiting for their trips to shop or opting for online shopping. “But there is also a very significant issue of unfair competition in mail-order shopping. Because products entering duty-free create major unfair competition with domestic importers or manufacturers, and due to their failure to pass health and standard tests—just as in many other countries—restrictions have been imposed in our country as well,” he said.
“Egypt is no longer as advantageous as before”
Also noting that some companies have shifted their investments to Egypt, Öncel said, “There are still those who want to go because labor costs have dropped. But those who went five years ago were at an advantage. Now, those who are going now say they’re facing very serious problems. Because the Egyptian government is imposing significant tax burdens on new entrepreneurs.”
“If you have a product, there’s always an opportunity”
Emphasizing that economic crises will always exist, Öncel said, “If you have a market and a product, there’s always an opportunity. I think it’s very wrong to say, ‘You absolutely shouldn’t invest in this.’ Because we’ve seen and experienced crises throughout our lives. I started my own business at age 23, and since then, there hasn’t been a crisis we haven’t seen. We’ve seen a wide variety of crises. If you ask, ‘What are your thoughts on the future?’ I’ll say, ‘This too shall pass.’ Just as the ones before it passed, so will this one. Those who are strong, have solid capital, add value to their business, are smart, and stand out—like an accordion—will be able to contract during tough times and continue to grow when the market opens up. Because Turkey is truly a vast country when you look at the nations around us. With a population nearing 90 million, its influx of tourists, and its export capacity to diverse markets, it’s a country capable of recovering very quickly. We may see sunny days again very soon.
The “Tuesday Meetings with Leaders” concluded with Rector Prof. Dr. Cemal İbiş presenting a plaque to Öncel and a group photo session following the Q&A session.