Retail therapy has long been one of Australia’s favourite activities and Aussies continued to open their wallets in March.
According to the latest figures from the Australian Bureau of Statistics (ABS), retail sales for the month recorded 5.4 per cent year-on-year growth to reach $35.3 billion.
Major categories that enjoyed a rise in revenues included cafes, restaurants and takeaway – up 17 per cent on the same month last year. Department stores, one of the major retailers of prestige beauty, saw sales lift 4.7 per cent. While clothing footwear and accessories posted growth of 3.6 per cent.
Household goods were on fire during and after Covid-19 lockdowns and restrictions as many people spruced up their homes. But the sector recorded a 5.7 per cent decline in sales year-on-year in March.
All states and territories saw growth in retail revenues in March – NSW ( +5.7% to $11.148 billion), Victoria (+5.6% to $9.079 billion), Queensland (+2.7% to $7.198 billion), South Australia (+8.2% to $2.27 billion), Western Australia (+6.9% to $3.919 billion), Tasmania (+7.1% to $710 million), Northern Territory (+ 4.7% to $315 million) and ACT ( +7.9% to $667 million).
Paul Zahra, CEO of the Australian Retailers Association (ARA) acknowledged that some categories are still recording reasonable sales year-on year, but overall retail sales were starting to slow.
“Cost-of-living pressures typically have a lag effect on retail and we are now witnessing the impact of months of continued interest rate rises and price rises on consumer spending.
“We can see a softening of year-on-year growth within clothing, footwear and accessories and department stores in the March results. It is important to note that in essential categories like food, inflationary price increases are mostly driving retail spending growth”, he added.
But in raw figures, rather than percentages, it’s very interesting to see where Australians are spending their money. Food was the biggest category in March with a spend of $14.011 billion ( +8.6%). In spite of the decline in sales, household goods ranked second for spending at $5.792 billion – down from $6.143 billion in March last year.
Other Retailing, including beauty, filled the third slot with sales of $5.353 billion – up from $5.27 billion in March 2022. Cafes, restaurants and takeway posted sales of $5.32 billion – up frm $4.548 billion by contrast to a year earlier
Australians also spent $2.944 billion on clothing, footwear and accessories in March – up from $2.841 billion. Department stores pulled in $1.886 billion – up from $1.801 billion – in March last year.
It continues to be a challenging period with retailers having to contend with continued rising costs, labour shortages and supply chain issues. But it’s good to see continued bounceback for the hospitality sector and the Federal Budget will be vital in providing support measures for the most vulnerable sections of our community including small businesses, added Zahra.
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