retailbiz.com.au 14/03/2013
Despite a disappointing year for retail in 2012, it’s tipped that sales growth is expected to record a gain of 2.2 per cent in 2012-13, according to a Deloitte Access Economics report.
The survey has predicted retail growth may lift marginally in 2013-14 (2.5 per cent), before improving to 3.6 per cent in 2014-15 as broader economic conditions and housing activity improve.
“While the start of 2013 may see a soft demand environment continue for retail, there are some positive signs on the economic horizon,” Deloitte reported.
“Low interest rates have yet to fully work through, asset price gains may be finally becoming a positive support to spending, consumer confidence is on a rising trend, housing activity has finally started to lift, and the household savings rate has levelled out, so future consumer spending growth should at least match income growth.”
At the same time, the reported suggested retailers are having some success in containing their cost growth in a tough environment with labour costs and wage growth in the retail sector having recently slowed to the same pace that was seen in the immediate post-GFC environment.
Across the country, retailers continue to face mixed fortunes. Western Australian retailers have just enjoyed two years of very strong retail growth, while over 2012 retail has also done well in the NT. Retail sales have seen solid growth in Queensland despite a patchy economy and in the ACT, defying Federal government restraint.
On the other hand, the New South Wales retail market has under-performed for some time, but may be finally starting to lift thanks to deep interest rate cuts and resulting signs of life in the NSW housing market. It has also been dismal in Victoria, South Australia and Tasmania.