Lift to Christmas spending

While retail was patchy across all sectors before Christmas the extra day of trading compared to last year appears to have had a positive effect, according to the Australian Retailers Association (ARA).

“Up until that long weekend of trading from Friday December 21 to Sunday December 23, many retailers were not confident on how sales were tracking,” ARA executive director, Russell Zimmerman told Appliance Retailer. “However on Christmas Eve we were getting reports from retailers that traffic was still strong, and while still not at the volume of the weekend, it was surprising as this is usually the time when focus is on food shopping.”

Zimmerman said retail trade in the lead up to Christmas was also affected by the Click Frenzy online sales event on November 23 that carried through to Cyber Monday and delivered more online space to consumers than in previous years.

“There was no loss of momentum from Black Friday through to Cyber Monday. People are getting more comfortable about putting their details online.”

However, data from Kepler Analytics and ShopperTrak showed there was a decline in foot traffic in bricks and mortar stores in the last six weeks before Christmas. “This suggested people were shopping online rather than in stores,” he said.

Data from Kepler also indicated that Boxing Day trading was weaker due to lower stock levels and fewer floor staff which Zimmerman said was contrary to what he was hearing. While he has yet to see evidence of this, lack of staff in New South Wales and South Australia could be attributed to recent state legislation that meant staff had to volunteer to work on Boxing Day in these states.

“The sales forecast for this trading period was $18.3 billion and it will be interesting to see if this is the case. I think it was busier than last year and my take-out is that Boxing Day and post Christmas sales were strong.”

Zimmerman said the view from major electricals was that business was tough in the lead up to Christmas but ‘romped’ home in the last couple of days with the extra trading day a valuable contributor that made a big difference to trade. He said while house prices have softened this could result in renewed emphasis on entertainment, technology and furniture categories in 2019. “Something that can be replaced or updated in the home when buying a new house is unaffordable but upgrading is the next best option.”

What will affect business going forward will be the NSW election in March and a Federal election before May, he said.

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