Over half of retailers failed to meet their sales targets in the quarter to 30 June, according to the latest Retail NZ Retail Radar Report.
Sales volumes gained 2 per cent in the three months ended June 30, 2017, following a 1.6 per cent rise in the March quarter, Statistics New Zealand figures show.
The value of retail sales rose 1.6 per cent, compared to the record 2.5 per cent increase in the March quarter.
Despite the steady rise in retail trade spending, Greg Harford, general manager for public affairs at Retail NZ, today said parts of the retail sector are under significant pressure.
“51 per cent of retailers have reported that they didn’t meet their sales targets in the last quarter, although strong growth was recorded in the accommodation, liquor and motor vehicle segments,” he said.
“Strong spending on hospitality, entertainment and food was driven by a number of events, including the Lions tour, the World Masters’ Games and Field Days, and heartland North Island areas performed better than the rest of the country.
“Retailers continue to face strong competition, both domestically and from foreign websites who don’t have to pay their share of tax.
“This is keeping prices down, but is creating unsustainable pressure on businesses in the long-term, particularly SMEs that may lack scale.
Harford said as a result of the economic headwinds, retail businesses are looking to develop more experiential offerings that connect with consumers in “an attempt to retain business” in a highly competitive market.
