New Zealand’s retail industry experienced a sluggish start to 2019, with over half of retailers failing to meet sales targets in the first three months of the year, according to Retail NZ’s Retail Radar survey.

This was impacted by business uncertainty and deflated consumer spending. A significant number of retailers also indicated the terrorist attack in Christchurch had a negative effect on business over the quarter.

Some retailers experienced extended good weather and enjoyed high numbers of tourists, while others experienced the opposite.

“The positive performance of the sector in the December quarter has not carried on, with survey respondents reporting the worst performance in the Retail Rader survey since the third quarter of 2017,” Retail NZ interim chief executive Greg Harford said.

“Retailers are facing substantially higher costs on the back of increased minimum wage, and are deeply concerned about the potential business impact if the Government pushes ahead with its plan for national wage accords, which could see a one-size-fits-all approach imposes across the entire retail sector.”

Thirty per cent of retailers said they plan to employ fewer staff over the coming months, due to the uncertainty surrounding wages. This continues a trend that has been apparent since the 2017 general election, according to Harford.

Many retailers are intending to pass increased labour costs onto consumers, with 40 per cent expecting to increase prices over the next three months, on top of the 15 per cent that reported price increases over this past quarter.