The latest retail spending figures from the Australian Bureau of Statistics (ABS) show a rise of 0.3 per cent, making it the weakest back-to-back results for 2018, despite being up slightly on market expectations.
Acting National Retail Association (NRA) CEO Lindsay Carroll said the report shows the need for the sector to not be complacent ahead of Christmas.
“The August ABS retail figures are far from disastrous, but they do show that the sector is continuing to experience a modest sales period,” Carroll said.
“The August report is certainly an improvement on July, with five of the six retail industries recording a rise in turnover, and all state and territories bar the Northern Territory seeing an increase in sales.
Seasonally adjusted retail spending was $26.87b, up from a flat $26.787b figure in July with Australian turnover rising by 3.4 per cent in August 2018 compared to the same period last year in trend terms.
The biggest growth market was other retailing which saw a rise of 0.6 per cent, followed by cafes, restaurants and takeaway food services with 0.4 per cent, clothing, footwear and personal accessory retailing with 0.3 per cent and food retailing with a growth of 0.2 per cent.
Household goods retailing, and department stores continued their downward trend, falling by 0.2 per cent and 0.1 per cent respectively.
Carroll said the ABS figures further emphasised the need for governments to put in place retail friendly measure ahead of the busy Christmas trading period.
“Given this is the weakest back-to-back monthly sales result for the whole of 2018, it’s very important that we don’t get complacent ahead of the most important period of the year, especially with increases to Saturday and evening penalty rates being phased-in for casual employees in retail from 1 November,” Carroll said.
“With consumer confidence still a little fragile at present, the NRA welcomed the news earlier in the week when the RBA refused to increase interest rates. A rise in the cash rate at this point would only result in shoppers having less money in their back pocket to spend”.
“We also urge state governments to put in place extended trading hours during the Christmas period so that Aussie retailers can take full advantage of consumer demand during the festive season”.
However, Russell Zimmerman, executive director of the Australian Retailers Association (ARA) disagreed with Carroll’s statement that consumer confidence was weak.
“We can see there was a slight uptick in consumer confidence around August with caf_s, restaurants and takeaway food services showing the strongest year-on-year growth at 5 per cent,” Zimmerman said.
“This quiet consumer confidence can be seen across various retail categories with consumers rewarding themselves with little luxuries across the market. We hope this boost in consumer confidence and discretionary spend flows through to the end of year where retailers are hoping to see their biggest trade yet”.