Food retail receives boost, sales figures highlight steady upward trend
Peak retail industry body the Australian Retailers Association (ARA) said it was optimistic the 0.2 per cent increase in September 2008 retail trade figures released today would continue the upward trend in the months leading into Christmas.
According to the ARA’s Executive Director Richard Evans, the September retail trade figures will come as welcome news for struggling retailers, indicating consumers with disposable dollars are likely to inject much-needed funds back into the retail sector during the Christmas period. “It is clear from the September figures that if consumers have disposable income, they will spend it,” he suggested. “The increase has been slow and steady over the past few months but these figures show tax deductions and lowering interest rates have put cash back into the pockets of consumers who are gaining the confidence to re-enter the marketplace and spend responsibly.”
“It is too soon to predict retail trade during the crisis in October because there are many variables, including the RBA’s likely interest rate cut tomorrow, the effect of Rudd’s stimulus package and continued strong employment. However, the September Retail Trade Trends are a positive indication that the financial relief being offered to consumers will make its way to retailers, allowing it to flow through the rest of the economy. ”
“It’s positive there are continued trade increases for the industries which have been suffering the most including clothing and soft good retailing and cafes, restaurants and takeaway food services (+0.2 per cent). The September Retail Trade Trends are a glimmer of light for retailers who have been suffering for most of the year and hopefully there will be more good news for the sector in the months to come,” Evans concluded.
Australian National Retailers Association CEO Margy Osmond believes another interest rate cut tomorrow will be vital to ensure that the slight increase in sales is not a one-off.
“Trend figures show food retailing is up 0.6 per cent, and cafes, restaurants and Department stores have made a comeback – both up 0.2 per cent,” Mrs Osmond said. “The first quarter was dead, the second quarter was dreadful and finally we are seeing light at the end of tunnel.”
“Therefore, these figures will be greeted by retailers with some relief rather than excitement. Growth is much lower than the same time 12 months ago when turnover rose by 0.7 per cent,” Mrs Osmond added. “Retailers are waiting to see whether the one per cent interest rate cut in October and the economic stimulus package will shift consumer spending.”