Australian retail turnover rose 2.7% per cent in June 2020, seasonally adjusted, according to the Australian Bureau of Statistics (ABS) following a rise of 16.9% in May.

“There were large month-on-month rises in cafes, restaurants and takeaway food services and clothing, footwear and personal accessory retailing”, Quarterly Economy Wide Surveys director, Ben James said.

However, department store and household goods retailing fell 12.1% and 3.2% respectively, he said.

Online sales remain elevated taking 9.7% per cent of total retail sales in June, a jump from 6.1% in June 2019.

And while the figures confirm a promising re-start for retailers these must be viewed in light of the pending impact of severe Victorian lockdowns, and the effect of stimulus spending, according to the Australian Retailers Association.

“While figures show a healthy appetite for spending when restrictions are lifted, we can’t read too much into the June data as the economic situation has changed dramatically in recent weeks,” ARA CEO Paul Zahra said.

“The severity of the blow in Victoria is likely to be felt across state boundaries, putting the brakes on a national recovery. Non-essential retailers will suffer a financial loss from physical store operations In Victoria, though this will be somewhat cushioned by the ability to continue online sales and national distribution which are areas the ARA has strongly advocated for,” Zahra said.

“If there’s a silver lining to the otherwise tough trading conditions this year, it is the consistent growth in online trading which we expect to shift from 10% to 20% over the coming two years. Omnichannel retail operations are a critical growth tool for retailers and during COVID-19 restrictions provide an important hedge against the closure of physical stores,” he said.

National Retail Association CEO Dominique Lamb responded with a similar forecast, acknowledging that the reintroduction of lockdowns in Victoria, the return of panic buying in parts of the country and general nervousness over a second COVID wave meant retail would continue to experience a challenging period in the months ahead.

“Although there was a sold rise for the month of June, retail volumes for the quarter went backwards by the biggest amount since the introduction of the GST.”

Lamb said that the situation in Victoria demonstrated that retail is in for a bumpy road ahead, particularly if other states are also forced to reintroduce restrictions.

“Victoria entering Stage 4 lockdown ensures that retailers in that state will certainly suffer immensely for the foreseeable future. We’re starting to see a return of panic buying in certain parts of the country, with consumers getting nervous about a possible uptick in infections.

“With only 1% of retailers looking to employ more people at present, business confidence remains stubbornly low. The extensions of JobKeeper and JobSeeker will help, but employers will continue to be very cautious over the period ahead,” she said.