Over half of retailers met or exceeded Christmas targets
More than half of retailers (56 per cent) met or exceeded targets for the quarter ending 31 December, up from 46 per cent in the preceding quarter, according to the latest Retail Radar report by Retail NZ.
“While 44 per cent of retailers still failed to hit their targets, the turnaround does show the importance of the final quarter of the calendar year in helping retailers survive and prosper,” Retail NZ general manager of public affairs Greg Harford said.
While Harford pointed out that online shopping event Black Friday fell within this period and “generated massive sales”, the report also points to strong spending by tourists, Christmas shopping as well as an improvement in the weather as positive factors which helped, and an unwillingness by consumers to spend, heavy discounting and bad weather in select areas contributing to negative results.
The report found 73 per cent of retailers expect to meet or exceed sales targets in the first three months of 2019 due to the good summer weather combining with the peak tourist season, while 30 per cent expect to see price increases during the same period – a significant drop from the 41 per cent observed last quarter.
However, the report also points to a trend of decreasing staff levels, with 21 per cent of retailers expecting to cut staff levels over the next quarter. This isn’t overly surprising, having come off the back of the increased staff levels due to Christmas-casual workers, but the longer term trend remains in favour of a slow decrease in staff.
“Since the 2017 General Election, we have seen a noticeable and ongoing increase in the number of retailers planning to reduce staff numbers quarter-on-quarter,” Harford explained.
“This may be due to economic uncertainty as well as concerns about the Minimum Wage and the Government’s intentions for the industrial relations framework.”