Retail sales volumes rise 2.5% in December quarter

Retail sales volumes increased 2.5% in the December quarter 2020, seasonally adjusted, according to the Australian Bureau of Statistics (ABS) Retail Trade figures. This follows the 6.5% rise in the September quarter 2020.

Director of Quarterly Economy Wide Surveys Ben James says “The quarterly rise was driven by Victoria (12.8%), as volumes recovered following Covid-19 restrictions from August to October. Without the Victorian rise, seasonally adjusted volumes would have fallen in the December quarter 2020.”

At a national level, clothing, footwear and personal accessory retailing (18.1%), and cafés, restaurants and takeaway food services (10.4%), led the rises in seasonally adjusted volume terms. Department stores (12%), and other retailing (2.7%) also increased.

Food retailing (-2.6%), and household goods retailing (-0.6%), recorded quarter-on-quarter declines in seasonally adjusted volume terms.

Monthly turnover declined 4.1%

Australian retail turnover declined 4.1% in December 2020, seasonally adjusted.

This updates the Preliminary result of -4.2% and follows an increase of 7.1% in November.

Mr James said: “Victoria (-6.8%) led falls at the state and territory level following stronger trade in November as Covid-19 restrictions eased. NSW (-4.9%) also fell as the Northern Beaches cluster impacted spending in the lead-up to Christmas.”
Queensland (-1.8%), WA (-2.0%), Tasmania (-4.6%), SA (-0.7%), and the ACT (-1.6%) also declined.

Despite the falls, in annual terms retail turnover remains at elevated levels, 9.6% above the levels of December 2019.

Following the large increase in November, five of the six industries declined in December, led by household goods retailing (-8.3%). Clothing, footwear and personal accessory retailing (-9.4%), department stores (-12.5%), food retailing (-1.7%), and other retailing (-4.4%) also declined in December. Cafés, restaurants and takeaway food services (3.2%) was the only industry to grow in December.

Online sales made up 9.1% of total retail sales in December 2020. Online contributed 6.6% in December 2019.

National Retail Association says the ABS December retail trade report revealed that Christmas 2020 was the biggest on record.

NRA CEO Dominique Lamb says that pent up demand following lockdowns and an inability for Australians to travel overseas had led to high levels of discretionary spending during the festive season.

“The ABS December figures are in line with the NRA’s pre-Christmas forecast that the 2020 festive season would be the biggest on record,” Ms Lamb said.

“Australian shoppers splurged more than $55 billion in retail sales throughout the second-half of November and all of December.

“From Black Friday and Cyber Monday in November right through to the final days before Christmas and Boxing Day, consumers across the country splashed their cash at the shops.

“The reopening of state economies coupled with Australians unable to spend the holiday period overseas led to a higher than usual level of discretionary spending.

“We also saw a substantial increase in online spending, with digital sales eclipsing the $5 billion mark across the Christmas period.”

Ms Lamb noted that while the figures are promising, the economy remains in a volatile state.

“These figures bode well for retailers, but as recent lockdowns in Queensland and Western Australian show the economy remains in a volatile state. Until a vaccine is widely administered there will remain a degree of uncertainty and the retail sector will continue to keep its guard up.”

Total Christmas trade figures for the 2020 period compared to 2019 are as follows: