January trade figures ‘softer’ than forecast, says ARA

The Australian Retailers Association (ARA) says the January 2019 trade figures have fallen short of forecasts, indicating “conservative” post-Christmas trade.

The figures, which the Australian Bureau of Statistics (ABS) released on Friday, show a 2.66 per cent total growth year-on-year.

ARA Executive Director Russell Zimmerman said: “As we forecasted a 3.1 per cent increase in post-Christmas trade, and predicted Australians would spend almost $18.3 billion from December 26, 2018 to January 15, 2019, today’s figures are slightly less than what we anticipated.

“While December sales started off strong, it seems to have slightly lowered for January. Despite today’s amicable figures, we’ll continue to partner with Roy Morgan annually to deliver the only professionally researched retail-industry predictions.”

Not all bad news

However, some categories showed “considerable growth” in January. These included:

  • Food retailing: 4.12 per cent
  • Cafés and restaurants: 3.15 per cent
  • Supermarkets: 4.52 per cent.

Commenting on the growth in these categories, Mr Zimmerman said: “This could be indicative of consumers feeling more confident to spend on small luxuries. We hope this trend will continue to increase and spill into other retail categories across the retail sector.”

Clothing, footwear and personal accessories also enjoyed “respectable” growth in January, the ARA says.

Dip for department stores

Unfortunately, department stores didn’t fare so well. They recorded a -1.38 per cent dip in year-on-year sales.

However, Mr Zimmerman says he’s optimistic these figures will improve in the coming months. He also pointed to Myer’s changing fortunes as a bright spot.

“Department stores saw a decrease in year-on-year growth for January,” he said. “But it’s important to note that Myer had a return on profitability for the first six months of this year.”

Year-year-growth by state

States across Australia showed mixed fortunes. Four states showed gains in year-on-year growth, whereas four showed declines.

Gains

  1. NSW: 0.65 per cent
  2. Tasmania: 0.42 per cent
  3. South Australia: 0.12 per cent
  4. Victoria: 0.11 per cent.

Declines

  1. WA: -0.34 per cent
  2. ACT: -0.40 per cent
  3. Queensland: -0.46 per cent
  4. Northern Territory: -1.21 per cent.

While welcoming the growth in some states, Mr Zimmerman lamented the poorer performance of others, the Northern Territory in particular.

“It’s concerning to see that the Northern Territory have yet again showed negative figures for the fifth consecutive month in row, after recording such strong results last year from March to August,” he said.

Check Also

Coles donates $1m to kick off national drought appeal

Coles has donated $1 million to drought-affected farmers as a national fundraising campaign launches at …