Wednesday, February 28, 2024

Retail sales rise in November

Consumers spent more than $36.5 billion across the country in November, according to figures released by the Australian Bureau of Statistics (ABS).

Australian retail turnover rose 2%, following a fall of 0.4% in October and a rise of 1% in September. Year on year, retail sales increased 2.2%.

“Black Friday sales were again a big hit [in 2023], with retailers starting promotional periods earlier and running them for longer, compared to previous years,” says ABS Head of Business Statistics Robert Ewing.

“The strong rise suggests that consumers held back on discretionary spending in October to take advantage of discounts in November. Shoppers may have also brought forward some Christmas spending that would usually happen in December.

“The popularity of Black Friday events [affected] spending patterns in the lead up to Christmas. This causes more volatile monthly movements in seasonally adjusted data.”

There were rises in all retail industries in November, but it was spending on discretionary goods boosted by Black Friday sales that drove most of the increase.

Household goods retailing rose 7.5%, followed by department stores (4.2%); clothing, footwear and personal accessory retailing (2.7%), and other retailing (1.1%).

Both food-related industries rose in November, with cafes, restaurants and takeaway food services and food retailing each rising 0.4%.

Year on year growth

Year on year, most categories recorded growth, with the most significant increases coming from cafes, restaurants, and takeaway (up 4.3%) and food (up 2.8%), and Department stores which recorded an increase of 3.3%.

Other retailing was up 1.2% and household goods recorded its first year on year increase in 2023 (up 0.5%).

The only category to record a decline was clothing, footwear and accessories (down 0.1%).

Australian Retailers Association CEO Paul Zahra says November’s results were bolstered by essentials such as food, dining out and Black Friday spending.

“While spending expectations heading into the broader pre-Christmas spending period were subdued, the growing popularity of Black Friday gave retailers some much-needed reprieve with shoppers seeking out bargains amid intense financial pressure,” he says.

“This certainly contributed to November’s overall spending growth, especially considering the Reserve Bank of Australia’s decision to raise the cash rate on Melbourne Cup Day.

“Food and takeaway again led the growth, and this is consistent with what we’ve seen all year – shoppers are prioritising the essentials under cost-of-living pressure.

“Shoppers are increasingly feeling the crunch of cost-of-living pressures and interest rate increases, making it a challenging time to be a discretionary retailer.”

State breakdown

Retail turnover grew across the country with large rises in all states and territories. South Australia (2.8%) had the largest rise, followed by Victoria (2.4%), with both states recording a fall in October.

All states and territories recorded growth year-on-year, too, led by the ACT (up 5.2%).

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