The Australian Retailers Association (ARA) said the trade figures released today by the Australian Bureau of Statistics (ABS) represent a better than expected start to the retail year with 3.11% total growth year-on-year.
Post-Christmas spending estimates by the ARA and Roy Morgan Research predicted sales growth of 2.9% over this period, and exceeding this figure is a strong sign for a broader rebound in the retail sector.
“Coming off the back of a moderate Christmas sales period, this post-Christmas sales figure is positive indication for the rest of the trading year. We are expecting this future growth to be complimented by improved conditions due the forthcoming reduction in Sunday Penalty Rates, leading to increased trading hours and greater sales volumes,” Mr Zimmerman said.
Clothing, Footwear and Personal Accessory retailing saw a strong growth of 5.18% year-on-year, continuing December’s positive salestrend, warm summer weather and sustained post-Christmas discounting cycles.
Food Retailing followed suit with a steady yearly growth figure of 3.49%, with the Takeaway Food Services sub-category again booming with an exceptional increase of 11.91% year-on-year.
Liquor Retailing remained robust (4.77% year-on-year) with increased consumption over the latter part of the festive season, and Supermarkets and Grocery Stores posted the strongest figure in several months with a year-on-year growth of 3.38%.
“This result is likely attributable to a reduction in deflationary pressure on supermarkets, as seen by increases in both volumes and sales in the category,” Mr Zimmerman said.
On the other end of the spectrum, Hardware, Building and Garden Supplies saw a disappointing year-on-year growth of 0.72%, a likely outcome of the ‘Masters effect’ resulting from the closure of a large number of stores as the brand winds down operations.
“With these closures there is a large volume of leftover stock in the market that is being discounted or dumped, bringing down prices across the retail hardware segment,” Mr Zimmerman said.
“However, we are expecting this low growth to pickup in the near future as the category returns to normal trading patterns and large players in the space take over Masters stores which are now closed”
In regards to the State categories, South Australia (4.5%), Victoria (3.82%) and NSW (3.19%) lead the charge with solid year-on-year growth figures. Queensland (2.83% year-on-year) and Tasmania (3.54% year-on-year) also showed moderate to good increases for the period.
“Overall, the January retail growth figures represent a firm foundation for the trading year, and we are hopeful for the continued growth of the sector as a number of significant legislative changes are implemented throughout 2017,” Mr Zimmerman said.
MONTHLY RETAIL GROWTH (December 2016 – January 2017 seasonally adjusted)
Household goods retailing (1.4%), Other retailing (0.1%), Food retailing (0.2%), Clothing, footwear and personal accessory retailing (-0.4%), Cafes, restaurants and takeaway food services (1.1%) and Department stores (-0.5%). Total sales (0.4%).
Northern Territory (-0.8%), South Australia (0.6%), Australian Capital Territory (1.2%), Victoria (1.1%), Tasmania (0.4%), Western Australia (0.3%), New South Wales (0.2%) and Queensland (0.0%).
YEAR-ON-YEAR RETAIL GROWTH (January 2016 – January 2017 seasonally adjusted)
Household goods retailing (2.00%), Cafes, restaurants and takeaway food services (6.01%), Food retailing (3.49%), Clothing, footwear and personal accessory retailing (5.18%), Other retailing (2.61%) and Department stores (-3.89%). Total sales (3.11%).
New South Wales (3.19%), South Australia (4.50%), Tasmania (3.54%), Victoria (3.82%), Australian Capital Territory (3.97%), Western Australia (1.17%), Queensland (2.83%) and Northern Territory (-0.83%).
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