New Zealand retailers expect cost pressures to fuel a 5 per cent increase in retail prices within the next three months. 

According to the latest Retail Radar report from Retail NZ, 92 per cent of retailers surveyed reported that supplier price increases are the biggest influencing factor driving retail price inflation. 

“This is closely followed by freight costs at 51 per cent, wage increases at 46 per cent and rent increases at 15 per cent,” said Retail NZ chief Greg Harford. 

“In many circumstances, a combination of these influences drove price increases.”

Domestic influences have meant that – as expected – retailers increased prices on average by 6 per cent in quarter three, with 71 per cent of retailers expecting to increase prices on average by 5 per cent in the next three months.

Harford said that signals current inflationary rates in goods and services will continue into next year.

“The latest report has shown minor improvements in retail confidence levels and in the number of retailers meeting sales targets, overall winter performance has not been strong. Retailers are more optimistic as they enter the Christmas and summer periods, with 63 per cent expecting to meet or exceed their quarterly targets.

“However, 30 per cent of retailers are not sure or not confident if their business will survive the next 12 months, only a slight improvement on the previous quarter.”

According to the survey, key ‘top-of-mind’ issues for the retail sector include wage increases, inflation, supply chains and freight costs.