Consumers spend up in December, new figures show

December sales rose 4 per cent year on year, according to the latest retail turnover figures released by the Australian Bureau of Statistics.

This growth backs up a 4.2 per cent year on year growth in November 2015, with Christmas gift buying at the heart of the boost in trade. Total retail spend for December 2015 was $24.8 billion.

December 2015 sales showed no increase over November 2015, a result the Australian Retailers Association (ARA) executive director Russell Zimmerman has put down to soaring temperatures following the initial Boxing Day trade.

“Australian retailers will be very pleased with the annual increase in shoppers’ spend in December,” said Zimmerman.

“December is the biggest month in the retail calendar in terms of sales and this considerable boost finishes off a year of strong increases for the industry.

“We’re hopeful the trend of steady growth will continue throughout 2016, with many retailers well positioned to leverage off these improvements with new innovations across online, omni-channel, and bricks and mortar stores.

“I think we’ll see 2016 become a year of business evolution for retail, with a host of digitally-based advancements enabling the merging of the online and offline shopping worlds into a more seamless experience.”

The biggest growth came out of household goods in December, with a 5.6 per cent increase over December 2014, followed by department stores, with a five per cent rise.

Victoria saw the lion’s share of growth on a state basis at 5.5 per cent, with Tasmania continuing its strong growth trajectory of the last few months, increasing sales by 5.2 per cent.

“Even Western Australia which suffered from considerably low sentiment in the lead up to Christmas as a result of the demise of the mining boom managed growth of 1.2 percent. This is a great result for a state that has been struggling to adapt to vast economic change.”

In terms of online spend for December, the NAB Online Retail Sales Index indicates that e-commerce sales increased a whopping 11.2 per cent on December 2014.

“E-commerce is a vital pillar of all retail business these days, and its double digit year on year growth is unsurprising when you look at how many retailers are now giving their customers the opportunity to shop online at their own convenience,” said Mr Zimmerman.

A total of $9.1 billion was spent online in 2015 according to NAB, 6.6 percent of the total retail market.

Retail Council CEO Anna McPhee said consumer activity throughout December was broadly in line with the Retail Council’s Christmas and summer clearance sale forecasts to deliver stronger growth than the same period in 2014, which is a good sign for the economy.

“Many categories delivered a solid performance in the year to December 2015 and are above long-term average annual growth, despite patchy month-on-month results across some retail categories in December.

“Despite retail sales continuing to grow year-on-year, monthly growth remains patchy making it difficult for the sector to achieve the sustainable momentum that is needed to reach long-term average growth levels. This further underlines the importance of reforms in tax, competition and workplace relations policy to boost the sector and drive improved performance and the sector’s contribution to the economy,” said McPhee.

YEAR ON YEAR RETAIL GROWTH (December 2014 to December 2015 seasonally adjusted)

By category:
Food, 3.2 per cent; household goods, 5.6 per cent; clothing, footwear and personal accessories, 4.5 per cent; department stores, five per cent; other retailing, 4.5 per cent; cafés, restaurants and takeaway foods, 3.2 per cent.

By state:
NSW, 4.5 per cent; Victoria, 5.4 per cent; Queensland, 3.1 per cent; South Australia, 3.4 per cent; Western Australia, 1.2 per cent; Tasmania, 5.2 percent; Northern Territory, 0.8 per cent; and Australian Capital Territory, 4.4 per cent.

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