The anticipated spike in trading in the latest ABS Preliminary Retail Trade Figures released today reflects suppressed consumer demand following the first month of returned trading after lockdowns, said Australian Retailers Association (ARA) CEO Mr Paul Zahra.
The preliminary data released today shows a 16.3% lift in estimated retail turnover from April to May 2020, with turnover increasing 5.3% in May 2020 compared with the same period last year.
“Whilst it’s heartening to see the elevated trading in May, it’s certainly too early to see this as a business as usual picture. Retailers are still experiencing a ‘sugar hit’ from suppressed spending during lockdowns across the previous month and we are conscious that consumer spending is also bolstered by JobKeeper payments,” he said.
“May marks the beginning of a slow and hard-fought path towards recovery for our retail sector. Whilst most stores have now reopened, many face significant ongoing financial pressure resulting from hibernation, increased new hygiene protocols and a reduction in overall foot traffic,” he said.
Mr Zahra predicted foot traffic is likely to be more subdued across the Winter period, as tourists, workers and visitors remain at low levels, particularly in city locations.
“Discretionary retailers, particularly those selling clothing, footwear and personal accessories, continue to face difficult conditions, with sales slowly returning but still well down on the same period last year.
“Shopping and entertainment go hand in hand and the increase in customers at restaurants, cafes and pubs will certainly help feed the retail economy,” he said.
Mr Zahra said seeing stores open and shoppers out and about helps elevate the national mood, and is a visible sign that economic recovery is underway.
“Whilst we are optimistic that the worst of the pandemic is over locally, COVID-19 is a global issue and there may still be flow-down impacts on supply chains and tourism. There is likely to still be some pain to come for some retailers, particularly after government measures are withdrawn in September,” Mr Zahra concluded.