From The Australian:
Retailers have no reason to get their hopes up this Christmas, with new forecasts suggesting broadly flat trade as weak wage inflation and economic concerns put a clamp on gift budgets.
Data from IBISWorld suggests a mere 0.4 per cent tick up in sales through December, with recent signs that consumers have become more frugal.
The lacklustre expectations are expected to lead to early sales from brick-and-mortar retailers.
“IBISWorld expects that discounting will characterise Christmas 2016, with price-conscious consumers being more discerning with their spending,” Nick Tarrant, IBISWorld senior industry analyst, said.
“Across a variety of consumer industries, IBISWorld has identified behaviour in the lead up to Christmas that suggests it will be a rather unremarkable one for retailers.”
That’s my view. But what happened since yesterday?
Festive season shopping is booming, with retailers estimating $47 billion will be spent across the nation in the six-week lead-up to Christmas Day.
The figure represents a rise of almost 4 per cent on last year, showing that even recent soft consumer sentiment forecast for the year ahead has been no dampener to Christmas retail activity.
Retailer Gerry Harvey said he expected an “outstanding” result by the time his Harvey Norman stores close on Saturday night, saying he had been selling well across all sectors but singling out high-end coffee machines.
“We’ve been looking at them year after year, thinking I can’t believe the sales of coffee machines, but every year they go through the roof and we’ve got about 40 per cent market share for machines over $1000,” he said.
And wait, there’s more:
Myer chief executive Richard Umbers might be just about the happiest man in retail at the moment, bathed in the warm glow of shimmering decorations at his Melbourne flagship store’s “Giftorium” where shoppers are swarming in the final week before Christmas.
Sure, consumer confidence is brittle, and yes, the economy shrunk last quarter to give the first strike in what is termed a technical recession if it is repeated this quarter, but the nation’s biggest department store is enjoying brisk trade and inspiring purchases through innovative gift ideas.
And if that isn’t enough to put a smile on his face, the gathering strength in Myer’s sales momentum comes at the time its rival David Jones witnessed its near double-digit sales growth almost grind to a halt in the second half of the year. “We think Christmas is going to pretty buoyant, whatever, we are still seeing our stores being very busy,” Mr Umbers told The Australian.
Silence of the parasites, that’s what.
