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Retail sales up in April as Australians eat out

 

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Retail sales rose in April, with unseasonably warm weather encouraging Australians to eat out.

According to the Australian Bureau of Statistics (ABS), sales rose 0.4 per cent in April 2018, seasonally adjusted, after a flat March.

Cafes, restaurants and takeaways led the rise (1.3 per cent), followed by other retailing (0.9 per cent), food retailing (0.3 per cent) and household goods retailing (0.7 per cent).

These were partially offset by falls in clothing, footwear and personal accessories (-0.8 per cent) and department stores (-0.9 per cent).

ABS director of quarterly economy wide surveys, Ben James said an unusually warm April had impacted the figures.

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“While industries including cafes, restaurants and takeaways can benefit from warm weather, there were likely negative impacts for some businesses in clothing, footwear and personal accessories, and department stores,” he said.

Australian Retailers Association (ARA) executive director Russell Zimmerman said the April figures were disappointing, with higher petrol prices and declining house prices party to blame for the soft trading conditions.

He agreed the unseasonably warm weather had impeded winter clothing sales, with retailers forced to begin early discounting to keep the tills ringing.

“The continued slide in the department store category shows no sign of abating, especially with its heavy reliance on clothing and footwear, which are also experiencing continual problems,” he said.

“While household goods retailing and cafes, restaurants and takeaway food remain strong, overall growth has been weighed down by mixed results in food retailing and clothing and department stores going backwards.”

Zimmerman said he is hopeful the introduction of the new GST laws from 1 July, which will see GST applied to overseas purchases under $1,000, will provide relief for retailers.

“Local retailers will finally be able to compete on a more level playing field once the GST changes come into effect, and we are hoping this will see consumers increase their spending in local stores.”

National Retail Association (NRA) CEO Dominique Lamb said fashion and department store sales should pick up as end of financial year (EOFY) sales begin.

“With several department stores and fashion outlets slashing their prices between now and 1 July, we are optimistic that sales in this area will pick up markedly in the month ahead,” she said.

The NRA is predicting Australian shoppers will spend close to $26 billion during the EOFY sales period in June.

In seasonally adjusted terms, there were rises in New South Wales (0.7 per cent), Victoria (0.3 per cent), Western Australia (0.7 per cent), Queensland (0.1 per cent), the Northern Territory (2.6 per cent), Tasmania (0.9 per cent) and the Australian Capital Territory (0.6 per cent). South Australia fell -0.6 per cent in seasonally adjusted terms.

Online retail made up 5.4 per cent of total turnover in original terms, a rise from 5.1 per cent in March.

 

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