November retail sales rise 2.8%

RETAIL sales got a welcome boost in November, rising 2.8% over the previous month. Bar sales rose 2.3%n in both value and volume terms.

Previously, the Irish Vintners Association claimed sales were down 25% since the introduction of the smoking ban in March last year. Davy Stockbrokers in a note on the November figures says the vintners have completely distorted that figure. Traditionally, sales in bars dip from September and start to pick up in November, rising sharply through Christmas.

The dip in sales is closer to 6% than the 25% claimed by the vintners, said the brokers.

In compiling its figures the bar trade missed the point of the “huge seasonal swing” in sales.

Traditionally, sales hold up in the first eight or nine months before a sharp dip and a strong recovery as Christmas kicks in.

“The salient point is that the volume of sales was down 5.8% seasonally adjusted between March, when the workplace ban was affected, and November and not the 25% claim of the vintners, said Davys. In November, retail volume sales rose 2.8% following declines of 1.7% and 1.8% for October and September. Overall analysts are forecasting an increase of 3% in retail sales for the year.

In the first 11 months of 2004, total retail sales were up by a similar amount over 2003.

Alan McQuaid of Bloxham Stockbrokers says overall figure for volume retail sales will stay about the same level as 2004.

But he sees a return to Celtic Tiger levels of consumer spending over the following two years.

Mr McQuaid says consumers are shopped-out after the boom years. They will bide their time this year and wait for the SSIAs to kick in. That should drive figures back up to levels witnessed during the Celtic Tiger period when retail sales were a major component in the 9% average annual economic growth achieved.

The November retail figures show a variation across the sectors.

Volume sales in food, beverages and tobacco rose 3.5%, while textile and clothing was up 2.1%.

Books newspapers and stationery showed a 9.4% hike against an annual rise of 3.2%.

Electrical goods were down 3.2% with furniture and lighting down 5%, while footwear and leather declined 3%.