The Australian Bureau of Statistics (ABS) has released strong growth figures for retail sales in September, but the stats do not paint an accurate picture for the petrol and convenience sector, according to the Australian Association of Convenience Stores (AACS).
Theo Foukkare, CEO of ACCS, said sales in the petrol and convenience sector are weaker than other industries as convenience and petrol retailers battle increasing costs and reduced demand in critical categories.
“Petrol and convenience channel retail sales have softened over the September quarter as consumer disposable income is being scrutinised by all Australians.
“The channel has experienced significant cost of goods increases which has reduced volumes in some key categories,” he said.
ABS figures show a month-on-month increase of 0.6 per cent and 17.9 per cent year-on-year in September, a comparison Foukkare says isn’t accurate.
“Comparisons to the September 2021 quarter are inaccurate given that NSW and Victoria were experiencing lockdowns during this period,” he said.
Looking to the future, the removal of the fuel excise rebate last month will put further pressure on consumers, but the effects are yet to flow through.
“Whilst the removal of the fuel excise came into effect on 29 September, the effects haven’t been felt during this quarter,” said Foukkare.
“The average fuel price has come down in some areas driven by the standard price discounting cycle, however diesel fuel prices remain abnormally high,” he said.
With inflation at its highest level in 32 years, it’s not surprising to see an increase in retail spending across the board, said Lindsay Carrol, Interim Chief Executive of the National Retail Association (NRA).
“The steady increase of spending in September was again driven by the increasing cost of food and produce, with food retailing at 1 per cent and food services with 1.3 per cent.
“Inflation is now at 7.3 per cent and food prices alone have jumped 9 per cent in the year to September,” she said.
With Christmas just around the corner, Carroll says consumers are preparing to cut down on everyday expenses in order to splurge on end-of-year celebrations.
She cites data collected in the NRA’s Consumer Sentiment Report, which shows Australian consumers are ready to embrace Christmas spending but are likely to cut back costs in other ways.
“People still want to have those great experiences and are looking for ways to save money in some areas while spending big on the special occasions,” she said.
In conclusion, she said it’s up to retailers to guide shoppers towards purchasing by using discounts and special offers to entice them.