Retail trade figures released by the Australian Bureau of Statistics (ABS) has dropped 0.5 pr cent in March 2011.

Turnover fell in departments stores by a dramatic 3 per cent, food retailing down 0.4 per cent, household goods retailing down 0.3 per cent and both cafes, restaurants and takeaway food services and other retailing were down 0.1 per cent.

The only turnover that came out positive was clothing, footwear and personal accessory retailing up by a 0.1 per cent.

Australian National Retailers Association (ANRA) CEO Margy Osmond said these results only show the struggling reality of the retail sector that continues to make a recovery.

“While the retail figures for January and February showed signs of improvement, the March drop is a better reflection of what retailers are seeing in-store,” she said.

“Drawn out sales periods and rebuilding after the Queensland and Victorian floods accounted for much of the improved activity in the first part of the quarter – without that stimulus, retail figures have dropped. In fact, this result has eliminated any positive growth seen in the first two months of the year.”

The fall in Australian retail turnover was driven by Queensland (-2.9%). Turnover also fell in Western Australia (-0.4%), New South Wales (-0.1%), Tasmania (-1.4%) and the Australian Capital Territory (-0.3%). Turnover rose in Victoria (0.9%), South Australia (0.3%) and the Northern Territory (0.3%).

Trend turnover rose 0.1 per cent in March 2011. This follows a rise of 0.1 per cent in both February and January 2011. Trend turnover rose 2 per cent in March 2011 compared with March 2010.

“The quarterly figures show sales volumes have actually dropped compared to the previous quarter (-0.1%) signalling retail can expect more of the same business conditions in 2011 as it experienced in 2010,” Osmond said.

She also noted that retailers will keep a careful watch of the Federal Budget that will be released on Tuesday.

“Retailers are hearing the Government talk about tightening the purse strings with some reservations. While fiscal conservatism is the ‘new black’ for governments and for consumers, at the moment it creates challenges for a sector that relies on households having discretionary funds,” she said.

“Any Federal Budget measures that cut into family budgets across Australia will impact on the retail sector. Retailers would welcome more measures like the increase in family payments for teenagers announced yesterday.

“Such measures will alleviate some of the pressures on Australian families, and that is only going to be a good thing for the economy.”