(Australian Associated Press)
Retailers are more pessimistic about this Christmas season than any they’ve been since 2013, according to a new survey.
Just 62 per cent of retailers expect to see higher sales this season, down from 80 per cent last year, according to the Deloitte Retailers’ Christmas Survey 2019, a survey of 56 senior executives from leading retailers in the Australian market.
“It’s clearly been a tough year for many retailers,” said Deloitte retail group leader David White.
“So it’s probably no surprise many are also approaching this Christmas with a little less cheer, certainly compared to last year.”
Retailers started off the year with high expectations but that optimism has faded, with trading conditions some of the toughest in recent history.
Adding to the retail gloom, a weekly ANZ survey of consumer confidence released on Tuesday
Many retailers pinned their hopes on the federal government tax cuts, but consumers have apparently kept any windfall in their pockets, Mr White said.
Retail trade figures released last week found that retail spending rose just 0.2 per cent in September, softening from an already underwhelming 0.4 per cent rise in August, even as $22.4 billion in tax refunds has flowed into households.
One reason may be that consumer confidence is lacking, with this week’s ANZ-Roy Morgan Australian Consumer Confidence index finding a 3.2 per cent decline in those who feel better off now than a year ago.
“Ultimately, uncertainty kills confidence, and global economic turbulence certainly isn’t helping,” Mr White said.
The Deloitte survey found that 40 per cent of the executives surveyed expected to experience a decrease in margins over the holiday season, compared to just 13 per cent in 2018.
Thirty per cent of retailers said they planned to discount in early December, compared to 24 per cent last year and 19 per cent in 2017.
Shopping centres are responding with tailored dining, entertainment and experiences to draw in customers, the survey said.
Digital sales continue to shine, with 58 per cent of retailers expecting growth of 10 per cent or more in online holiday sales, the survey found.
For 2020, 72 per cent of retailers are expecting a better year ago – but most weren’t expecting growth of more than five per cent.
“Australian retailers will be waiting for a recovery in wage and jobs growth to provide a boost where interest rates and government tax cuts fail to provide the stimulus needed,” Mr White said.