The Australian Retailers Association (ARA) has forecasted that the retail sector will grow by 4.7 per cent year-on-year for 2009 with sales expected to reach $38.7 billion.
Russel Zimmerman, ARA executive director, commented that this rise in sales from $36.95 billion for 2008 is an improvement but insists it will remain challenging. According to Zimmerman 72 per cent of retailers found last week’s trading either met or was below expectations.
“Although last week’s trading did not rise above expectations for most retailers, 65 percent said last week’s trading was similar to or better than this time last year. The fact that retailers are expecting better sales than last year but are not yet meeting their targets shows there is optimism, although a significant portion of retailers are still hampered by patchy trade,” he said.
“The reality is that three successive interest rate rises are affecting consumers who are now less confident.”
According to the ARA research, the $38.7 billion will roughly break down to $15.47 billion for food, $3.21 billion for department stores, $2.71 billion for apparel, $6.58 billion for household items, $5.06 billion for hospitality and the remaining $5.67 billion will be spent on other categories.
“From our research, we constantly come across a type of consumer – a conservative, thrifty and wary consumer keen on making their dollar really stretch across lower end and reduced priced products,” he said.
“Over the Christmas season, retailers will experience fair trade but it will be below their expectations.”