Published: 2021-12-05 18:26:30 BdST
The HDE said sales in bricks-and-mortar non-food retail were down an average of 26 percent in the last week compared to the pre-crisis year of 2019, according to a survey of some 1,600 firms.
Clothing retailers were particularly hard hit, with sales down 35 percent on the pre-crisis level.
Visitor numbers in city centre shopping districts are down 41 percent compared to 2019. This time last year, restaurants and bars were closed in a partial lockdown and there were limits on the number of people allowed to meet, although stores were open.
German officials agreed on Thursday to bar unvaccinated people from accessing all but the most essential businesses such as grocery stores, pharmacies and bakeries, and also decided to seek to make vaccination mandatory.
"The introduction of stricter coronavirus measures in shops is a dramatic disruption to the Christmas business," HDE Chief Executive Stefan Genth said in a statement.
The HDE is therefore calling on the government to provide more financial support to retailers.
Germany recorded 42,055 new infections on Sunday and another 94 deaths, bringing the total death toll to 103,040.
"Retailers had placed their hopes on the Christmas business," Genth said. "But now many retailers are once again moving closer to the precipice with each passing day: a disastrous outlook."
According to HDE estimates, sales losses in the affected non-food retail sector may amount to 5.5 billion euros ($6.22 billion) in December. According to the survey, 77 percent of firms have negative expectations for the weeks ahead.