Wednesday, June 19, 2024

Aussies to continue spending this Christmas

Most surveyed Aussies (59%) claim they will spend the same or more (12%) this Christmas than they did last year, despite growing inflationary pressures.

The Christmas Gift Buying Survey by the Australian Retailers Association (ARA) and Roy Morgan also found the average gift purchase is $700, down slightly ($26) on last year.

ARA holiday sales predictions with Roy Morgan forecast Australians will spend nearly $64 billion in the lead up to Christmas. This is up 3% on last year.

Categories of interest

Sensory indulgence is a key theme for 2022, with alcohol and food topping the list of intended gift purchases for this year. This is followed by gifts cards and toys.

Men were the most likely to purchase alcohol or food, while women were more interested in small inexpensive gifts or novelties, clothing shoes and sleepwear or books and music.

Hospitality businesses are also set to flourish in the run up to Christmas, with over $9 billion in trade predicted, up 16.3% on 2021.

Confidence boost

ARA CEO Paul Zahra says retailers have a lot to feel confident about this year, despite the economic headwinds.

“We are likely to see the robust spending continue for Aussie retail,” he says. “This is encouraging news given the economic circumstances – most discretionary retailers make up to two thirds of their profit during this critical trading period. Many small businesses remain in recovery mode and have seen massive increases to their cost of doing business over the past two years. This forecast spending boost will help boost their dwindling cash reserves.

“Aussies truly plan to eat, drink and be merry this Christmas. It’s no surprise we are seeing a shift towards food and entertaining with the holiday period over the past two years spent in the shadow of lockdowns. The news couldn’t come at a better time for the hospitality sector who have endured more pain than most businesses through the pandemic.”

Spending across the country

Out of the states and territories, South Australia is set to record the biggest growth in sales on last year (up 6.6%), followed by the Northern Territory (up 6.5%).

Consumers in NSW are forecast to spend nearly $20 billion in the pre-Christmas sales (up 3.1% on 2021), with Victorians to fork out $16.5 billion (up 0.8%) and Queenslanders $13.3 billion (up 4.6%).

Black Friday

The Black Friday sales are set to provide retailers with strong results in the lead up to Christmas.

ARA and Roy Morgan forecast sales to reach a record $6.2 billion over the four-day Black Friday/Cyber Monday weekend (25-28 November).

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