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Christmas comes early as retail spending grows 5% year-on-year in November

Australian retail sales increased 5 per cent in November compared to the same time last year, according to the latest Mastercard SpendingPulse™.

by | 18 Dec, 2022

Most retail categories continued to record significant year-on-year sales growth, with lodging recording the biggest increase in trade in November, up 21 per cent compared to 12 months prior.

This was followed by Grocery (up 10.3 per cent), restaurants (up 8.9 per cent), apparel (up 8.6 per cent), fuel and convenience (up 4.8 per cent) and electronics (up 2.6 per cent). There were year-on-year falls for home furnishings (down 4.1 per cent) and jewellery (down 1.2 per cent) off an elevated level of sales in the previous year due to the pandemic.

Australian Retailers Association (ARA) chief executive Paul Zahra said the results confirm that Christmas continues to come earlier for retailers, with consumers motivated to get in ahead of price increases and to avoid supply chain disruptions.

“Whilst we’ve seen the overall year-on-year sales growth slow, these remain really pleasing results in a challenging economic environment. The growth is driven by a host of factors, including the incredible growth in Black Friday and Cyber Monday sales in Australia; price increases are also a factor which are also driving Australians to spend to get in ahead of inflation.

“After a couple of years of hibernation, we can see Australians are taking advantage of hospitality venues — flocking back to restaurants, enjoying home entertainment and domestic travel after the impact of lockdowns last year.

“The ARA expects this to be the biggest Christmas on record for Australia, with Aussies predicted to spend $66 billion in the Christmas trading period — up 6.4 per cent on last year’s spending, according to our ARA holiday sales predictions with Roy Morgan. Moving into next year, we do expect things to slow down — with a lag effect likely to the impact of inflation on retail spending.

“We acknowledge that it remains a challenging environment for businesses, particularly small businesses on tighter margins, as they continue to battle rising operating costs associated with fuel, energy, labour, supply chains and rent,” Mr Zahra said.

 

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