Thursday, February 22, 2024

Retail trade up 0.6% in September

Australian retail turnover increased 0.6% in September 2022, according to Retail Trade figures released by the Australian Bureau of Statistics (ABS).

The September increase was the ninth consecutive increase, following a 0.6% rise in August 2022 and a 1.3% rise in July 2022.

ABS Head of Retail Statistics Ben Dorber says, “This month’s rise was again driven by the combined strength in the food industries. Food retailing rose 1.0 per cent, while cafes, restaurants, and takeaway food services rose 1.3 per cent.

“Many retailers remained open for the National Day of Mourning, an additional one-off public holiday in September, and this boosted spending on food, alcohol and dining out.”

Clothing, footwear and personal accessory retailing had the largest percentage growth, up two% following a decline of 2.3% in August 2022. Other retailing also increased, up 0.2%.

Household goods retailing declined 0.8%, a slight decrease after last month’s growth of 2.6%. The fall in September was softened by the release of new mobile phone models and is the fourth monthly fall in household goods retailing in the last six months. Department stores also fell, down 0.4%.

Mr Dorber said the latest Consumer Price Index showed that prices continued to rise strongly in the September quarter. To see the effect of consumer prices on recent turnover growth it will be important to look at quarterly retail sales volumes which will be released later in the week.

Additional information on the September reference period, including quarterly price and volume data, will be released on 4 November 2022.

Robust retail sales leading into Christmas

Retail sales continued to strengthen in September, with $35.1 billion spent in stores and online – an increase of 17.9% on a year ago and up 0.6% compared to the previous month, according to the ABS.

As we continue to cycle the Delta lockdowns of 2021, there were substantial year on year sales increases across all categories, led by clothing, footwear and personal accessories (up 70.4%), cafes, restaurants and take away food (up 52.6%) and department stores (up 53.6%).

Australian Retailers Association CEO Paul Zahra says, “It’s fantastic to see the momentum maintained as we head into the all-important Christmas trading period – a time when many of our discretionary retailers make up to two-thirds of their profits. Despite the challenging economic times, retail spending remains extremely healthy and that’s great news for retail and a positive sign for our broader economy.

“Whilst there is a lot to celebrate, we are mindful of the impact that inflation and higher prices have on these sales results – with year-on-year comparisons also strongly influenced by the hangover of the Delta lockdowns last year,” Mr Zahra said.

“We are cautiously optimistic about the months ahead, and the ARA forecasts a 3% year-on-year increase in Christmas spending. We also know that for many small businesses, the sales are critical in replenishing cash reserves from the pandemic period so these results are truly welcome.

“We are likely to see many Australians bring their spending forward this Christmas, as they aim to get in ahead of inflationary increases, avoid supply issues and secure their gifts well ahead of the Christmas rush,” he said.

“We could see a softening of sales as we enter 2023. There is likely to be a lag effect from current inflationary conditions as we see the full impact of interest rate increases flow through the economy, and inflation reaches its forecast peak.

“Overall trading conditions continue to be challenged by supply chain constraints and staff shortages with vacancies continuing to be at record levels,” Mr Zahra said.

Retail category performance

RETAIL CATEGORY   YEAR ON YEAR SEASONALLY ADJUSTED RETAIL SALES GROWTH

(SEPTEMBER 2022 v SEPTEMBER 2021)

 

 Food retailing +4.0%
Household goods +10.6%
Clothing, footwear and personal accessories  +70.4% (cycling 11.1% contraction the previous year)
Department stores +53.6% (cycling 16.8% contraction the previous year)
Cafés, restaurants and takeaway food +52.6%
Other retailing + 11.5%
Total retail +17.9%

 

State and territory performance

STATE/TERRITORY YEAR ON YEAR SEASONALLY ADJUSTED RETAIL SALES GROWTH

(SEPTEMBER 2022 v SEPTEMBER 2021)

 

NSW +25.9%
Victoria +22.9%
Queensland +9.7%
Western Australia +7.8%
South Australia +8.7%
ACT +52.8%
NT +5.0%
Tasmania +6.1%
All states and territories  

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