Retail spending is soaring in New Zealand, but the head of Retail NZ advises caution in the lead-up to Christmas. 

According to the latest Retail NZ data, overall sales in October were up a massive 20.7 per cent on October last year. Spending from March (when Covid-19 hit) through to October is 0.3 per cent ahead of the same period last year. 

“This reflects the fact that consumers have money in their pockets, supported by low interest rates and increase in house prices, and that New Zealanders are still unable to travel overseas because of Covid-19,” said Retail NZ CEO Greg Harford. .

However those results are not spread evenly across the sector. 

“Previous Retail NZ research suggests that, while some retailers are performing extremely well, a minority is selling substantially less than last year. These are likely to be businesses particularly exposed to the inbound tourist market, or those which do not have a strong online presence,” said Harford.

“Notwithstanding the good October results, there are real challenges in the run-up to Christmas.  Many retailers are reporting stock shortages stemming from supply chain delays. The big issues are reduced freight capacity down to New Zealand, as well as congestion at the Ports of Auckland and Tauranga. Stock is taking substantially longer to arrive from suppliers overseas, and retailers are needing to order much earlier,” said Harford.

Retailers are also nervous that a re-emergence of the pandemic in the community might spark further lockdowns. 

“These have the potential to be catastrophic in the short-term, particularly in the absence of strong government support.”

He has warned consumers to shop early for Christmas and shop local to support businesses keeping New Zealanders employed and boosting local economies. 

The Retail NZ Sales Index records the change in average sales per site at Retail NZ members who process credit and scheme debit cards with Westpac.