Consumers spent $36.1 billion across the country in July, compared to $35.3 billion in July 2023, according to figures released by the Australian Bureau of Statistics (ABS).
Australian retail turnover was unchanged in July, following a rise of 0.5% in June and a rise of 0.5% in May. Year on year, retail sales increased 2.3%.
“After rises in the past two months boosted by mid-year sales activity, the higher level of retail turnover was maintained in July,” says ABS Head of Retail Statistics Ben Dorber.
Turnover results were mixed across the industries with most recording a fall or flat result following rises in June.
Clothing, footwear and personal accessory retailing (down 0.5%) had the largest fall, followed by department stores (down 0.4%) and cafes, restaurants and takeaway food services (down 0.2%).
Household goods retailing and other retailing were both unchanged.
The only industry that had a rise in July was food retailing (up 0.2%).
Year on year sales
Other retailing – including cosmetics, sports and recreational goods – saw the strongest growth in July (up 5.5%) year-on-year along with the staple category of food (up 3.2%) and household goods (up 1.5%). Clothing, footwear and accessories (up 0.5%) and department stores (up 0.1%) showed marginal growth. However, cafes, restaurants and takeaway services (down 0.3%) declined year on year.
Australian Retailers Association (ARA) CEO Paul Zahra says the pockets of marginal growth in discretionary categories in July were bolstered mainly by the continuation of mid-year sales.
“[In July], Australians continued to shop on price and value as we saw in the end of financial year sales. Households continue to prioritise essentials like food but also focused on small personal luxuries – cosmetics, sports and recreational goods,” he says.
“As tough times continue, we are seeing the so-called ‘lipstick effect’ play out, where people are having to do more with less. There are trade-offs in this budget-conscious environment and in July we saw people replacing dining out with food from their local supermarket, allowing some spending on personal luxuries.
“This remains one of retail’s most difficult years, with a continued slowdown in discretionary spend, high business costs and inflation along with ongoing challenges such as retail crime, supply chain disruptions, and the most significant workplace relations reforms in decades.
“While there is great resilience within retail, we know there are many businesses in the sector especially small businesses. The ARA continues to call for a targeted government support for vulnerable retailers who contribute to the nation’s $420 billion retail sector.
“Discretionary retailers will be counting on the peak season ahead to replenish their cash reserves. Major shopping events in coming months include Halloween, Black Friday and Cyber Monday and the festive period, which will hopefully provide a much-needed boost to the industry.”