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Good News for Retail, but what About Online?
Recent trade figures released by the Australia Bureau of Statistics are encouraging, but do online retailers really have cause to celebrate?
The latest Australian Bureau of Statistics (ABS) Retail Trade figures show that retail turnover rose 0.4 percent in June 2018, seasonally adjusted, following a 0.4 percent rise in May 2018. The Australian Retailers Association (ARA) believe these figures represent a ‘fair trade’ for the end of financial year, with a 2.87 percent total growth year-on-year.
“Clothing, footwear and personal accessories rose 1.7 percent, following a 2.3 percent rise in May,” said Ben James, Director of Quarterly Economy Wide Surveys. Department stores fell by 1.2 percent in June 2018.
“Winter finally hit in June as we saw the clothing, footwear and personal accessories category grow by 5.26 percent year-on-year,” agreed Russell Zimmerman, Executive Director of the ARA.
The trend estimate for Australian retail turnover rose 0.3 per cent in June 2018 following a rise of 0.4 per cent in May 2018. In June 2017, the trend estimate rose 3.1 percent.
The ARA said that the key retail categories posted ‘healthy results’ and linked this to the business confidence increase Roy Morgan has reported for the month.
“Business confidence often falls after the Federal Budget; however, this increase shows greater strength in the market, giving retailers much-needed assurance to invest in their businesses and execute product strategies,” Mr Zimmerman said.
Impressively, online retail turnover represented 5.7 percent of total retail turnover in original terms in June 2018, a rise from 5.6 per cent in May 2018. For the same time last year, online retail turnover contributed 4.1 percent of total retail.
Yet while the results are encouraging for the retail sector, online retail sales actually slowed in June (1.2 percent in seasonally adjusted terms) according to the NAB Online Retail Sales Index. In the 12 months to June, Australians spent an estimated $26.5 billion on online retail, according to the Index. It shows that domestic online retailer sales were up (+1.4 percent month on month, seasonally adjusted), while the International competition contracted slightly (-0.2% month on month, seasonally adjusted).