Retail sales have increased for the ninth consecutive month, according to recent figures from the Australian Bureau of Statistics. However, the marginal growth has left retailers in Australia cautious about the upcoming winter sales season.
Released on June 3, the ABS report revealed retail turnover climbed by 0.2 per cent in April this year, contributing to a 5.7 per cent year-on-year increase. Despite this trend in growth, lead industry body the Australian Retailers Association (ARA) says the result is “somewhat disappointing” for local retailers.
ARA Executive Director Russell Zimmerman explained that unexpectedly warm temperatures in recent months had possibly contributed to the muted growth, with many retailers failing to match traditional seasonality with the change in buying behaviours.
“Australia experienced unseasonably warm weather in April causing consumers to hold off on purchasing their winter wardrobes and other winter related household items,” Mr Zimmerman revealed.
“It’s being felt across the industry, from those selling winter coats and boots, to the kitchenware’s business, such as soup makers and crockpots, to electric blankets and heaters. Even if we get a sharp cold spell, most people will now wait for the sales to buy new items that they may only use for a couple of months.”
Australian National Retailers Association Chief Executive Officer Margy Osmond agrees that the slow growth over the past few months is unlikely to be sustained through winter.
“April was the final month before households took note of the federal budget,” she said. “While [the ABS report] is a nice surprise for retailers, we would expect May and June to be the deal breakers in retail sales momentum.”
Responding to unseasonable weather
Many store owners in Australia are struggling to move their winter stock, leading to the need for drastic changes to their retail strategies. In particular, many department stores and shopping centres have waved the white flag – offering sales and other incentives to entice consumers in store.
As the unseasonably warm weather is forecast to continue this year, retailers in Australia may need to reconsider their traditional winter branding. For advice and guidance through this time, contact a retail consultant today.