The recent trend for declining growth in retail sales continued through the June quarter, according to the latest edition of the Retail Index report from the Australian Food and Grocery Council (AFGC) and packaging company CHEP. But the report also predicts the rate of year-on-year growth will increase by the September quarter.
According to the AFGC, the Index indicates an increase of 2.8 per cent for the three months ended 30 September 2013, up from 2.6 per cent year-on-year growth in the three months ended 30 June, which would be the third consistent quarterly decline in the rate of growth.
For the month of June, the AFGC said the Index indicates that the Australian Bureau of Statistics (ABS) will report year-on-year retail trade growth of 2.5 per cent and turnover of $21.9 billion. The Index forecasts August year-on-year growth will be 2.7 per cent, with turnover increasing to $22 billion.
“The retail environment remains challenging, reflecting subdued consumer confidence,” said Gary Dawson, AFGC CEO. “Indications of growth improving later in the year once the Federal election is out of the way are encouraging and would see improved consumer spending supporting retail sales growth,” he said.
Food and grocery improving, compared with overall retail
Recent ABS statistics have shown improving year-on-year growth in food and grocery retail compared with overall retail sales growth, according to the AFGC.
Results published by the ABS for the month of May 2013 show food and grocery retail sales grew by 4.2 per cent over the past year. In contrast, sales at clothing retailers were flat, sales at department stores contracted, and household goods retailers posted a growth of about 1 per cent.
“CHEP’s data insights support the view that the Australian economic landscape and retail environment are today something of a patchwork,” said Phillip Austin, CHEP Australia and New Zealand President. “The predicted retail trade growth to August 2013, as well as inventory and consumer confidence indicators suggest more of the same in the first quart of the 2014 financial year,” he said.
The next AFGC CHEP Retail Index will be released in late October 2013.
