October retail sales up 1.2% year-on-year as discretionary categories continue to slow

Australian retail sales increased 1.2% year-on-year in October, with increases in food related categories bolstering otherwise underwhelming results.

According to figures released today by the Australian Bureau of Statistics (ABS), shoppers spent more than $35.7 billion across the country in October.

The most significant year-on-year sales increases came from cafes, restaurants, and takeaway (up 4.6%) and food (up 3.3%), as has been the case in recent months.

Department stores (up 0.4%) and other retailing, including recreational, sporting goods, cosmetics (up 0.3%) recorded stable spending year-on-year, while clothing, footwear and accessories experienced decline (down 0.7%).

Household goods again recorded spending decline (down 4.6%), marking ten consecutive months of negative growth.

All states and territories recorded growth year-on-year, led by Western Australia (up 3.5%), ACT (up 3.2%), Northern Territory (up 2.8%), South Australia (up 2.8%), Victoria (up 1.0%), Queensland (up 0.7%), Tasmania (up 0.7%) and New South Wales (up 0.1%).

Australian Retailers Association (ARA) CEO Paul Zahra said the October results only remained positive due to consistent spending on essentials like food.

“Spending on essentials remains consistent, while discretionary goods categories are clearly taking a hit,” Mr Zahra said.

“Food and takeaway again led the spending growth, and this is consistent with what we’ve seen all year – shoppers are prioritising the essentials in a cost-of-living crisis.

“While spending on takeaway remains positive with shoppers opting for value options such as quick service restaurants to ease pressure on their budgets.

“Shoppers are increasingly feeling the crunch of the cost-of-living crisis and interest rate increases, making it a challenging time to be a discretionary retailer.

“October’s underwhelming results also came amid the Reserve Bank of Australia’s last interest rate pause. We expect retail sales will be impacted even more by November’s interest rate hike.”

Mr Zahra said retailers will be watching for November’s retail trade results with interest, given the prevalence of this year’s Black Friday sales.

“Black Friday has been forecast to be record-breaking this year, with shoppers desperate to cross off their Christmas wish-lists during the biggest pre-Christmas sale event of the year, which is likely to impact December’s numbers.

“Retailers and Australians will be anxiously awaiting the RBA decision next week, which will affect the final few weeks of Christmas spending.

“Whist much has been said about the cost-of-living crisis, retailers are also experiencing a cost of doing business crisis and will be concentrating on offering the best service and value for budget conscious shoppers during the all-important Christmas trading period.”

 

CATEGORY

OCTOBER 2022

OCTOBER 2023

CHANGE

Food $13.774 billion $14.232 billion +3.3%
Household goods $6.074 billion $5.791 billion -4.6%
Clothing, footwear, accessories $3.002 billion $2.980 billion -0.7%
Department stores $1.900 billion $1.908 billion +0.4%
Cafes, restaurants, takeaway $5.163 billion $5.400 billion +4.6%
Other $5.432 billion $5.453 billion +0.3%
Total $35.346 billion $35.767 billion +1.2%

 

STATE OCTOBER 2022 OCTOBER 2023 CHANGE
New South Wales $11.158 billion $11.179 billion +0.1%
Victoria $9.109 billion $9.203 billion +1.0%
Queensland $7.277 billion $7.328 billion +0.7%
South Australia $2.238 billion $2.302 billion +2.8%
Western Australia $3.894 billion $4.030 billion +3.5%
Tasmania $703 million $708 million +0.7%
Northern Territory $314 million $323 million +2.8%
ACT $651 million $672 million +3.2%
Total $35.346 billion $35.767 billion +1.2%

 

ARA Media Enquiries: M 0434 381 670 E media@retail.org.au

 

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