Roy Morgan’s annual Christmas retail sales forecasts conducted in conjunction with the Australian Retailers Association (ARA) indicate Australians will spend over $52.7 billion across retail stores during the Christmas trading period.
Forecast retail spending this Christmas of over $52.7 billion is an increase of 2.6 per cent from the $51.4 billion of retail expenditure during the 2018 Christmas trading period.
Growth in retail expenditure is predicted across all six categories measured with spending on Food expected to grow by 3.2 per cent from a year ago to nearly $21.7 billion. Also set to grow strongly will be Apparel including clothing, footwear and accessories up three per cent to almost $4.2 billion.
Hospitality businesses are forecast to grow by 2.3 per cent to an expenditure of well over $7.4 billion and an impressive $8.8 billion is expected to be spent on Household Goods this Christmas, an increase of 0.6 per cent from a year ago. Department stores are set to experience slower growth than other categories, up by 0.5 per cent, to overall spending of almost $3 billion.
The category combining ‘Other retailing’ which includes online retailing is predicted to experience the fastest growth of all, up by 3.7 per cent to spending of over $7.6 billion.
Retail sales forecast to grow most strongly in Queensland, Victoria and Tasmania
Analysis of Roy Morgan’s pre-Christmas retail forecasts by State and Territory shows growth is expected across the nation led by Queensland, up by 3.6 per cent to over $10.6 billion.
Christmas retail spending is also forecast to grow strongly in Victoria, up by three per cent to over $13.8 billion and Tasmania up by 2.3 per cent to $1.06 billion. Australia’s largest State of New South Wales is forecast to have Christmas retail spending of nearly $16.8 billion, an increase of two per cent with a similar level of growth expected in South Australia, up 2.1 per cent to $3.4 billion.
Forecast Christmas retail spending in Western Australia is predicted to increase by 1.7 per cent to over $5.5 billion while there are also increases predicted for both the ACT and NT.
Roy Morgan CEO Michele Levine commented: “The annual ARA/Roy Morgan Christmas retail spending forecasts predict a spending increase of 2.6 per cent in 2019 to over $52.7 billion in the important pre-Christmas retail period. This is slightly below the 2.8 per cent growth of a year ago although remains well above the current ABS Inflation rate of 1.7 per cent.
“Growth is predicted across all retail spending categories led by food which is expected to increase 3.2 per cent to $21.7 billion. The food category comprises over 40 per cent of all pre-Christmas retail spending. Other spending categories expected to grow above the inflation rate include Apparel – clothing, footwear and accessories (up three per cent), hospitality (up 2.3 per cent) and other retailing – which includes online spending (up 3.7 per cent).
“The small drop in growth from a year ago is in line with other indicators such as the ANZ-Roy Morgan Consumer Confidence Index which is now at 111.1 and has averaged 112.0 since early September. This is about five points down on a year ago when the index averaged 117.4 in the pre-Christmas period of 2018.
On a State-by-State basis growth is expected to be strongest in Queensland (+3.6 per cent) and Victoria (+three per cent), but there is also above inflation level growth forecast for Tasmania (up 2.3 per cent), SA (up 3/1 per cent), NSW (up two per cent) and the ACT (up 2.6 per cent).
“The pre-Christmas retail period has begun this year with many parts of Australia, particularly in New South Wales and Queensland, facing devastating bushfires and uncertainty about how long these conditions will persist. We recognise that the ongoing threat of bushfires introduces a significant degree of unpredictability to these forecasts and we want to send our goodwill and prayers to everyone impacted by this natural disaster for a safe and happy Christmas and New Year period.”