Retail sales plunge again

RETAIL sales continued to plunge in the last three months of 2009 but the industry is expecting a pick-up later this year.

Despite a highly publicised supermarket price-war grocery sales were down almost 11% in the final quarter of 2009 compared with the same period in 2008.

Menswear was the worst performing sector of the year falling 21% compared with 2008. Giftware and homeware sales were down 17% while ladies fashion fell 16%, according to figures from Retail Excellence Ireland (REI).

Unsurprisingly, December was the best performing month of the year, with trade picking up after the December budget.

Shoppers spent almost a fifth less in the period with the Q4 Average Transaction Value (ATV) of €45.29 19% lower than the ATV of €56.16 a year earlier.

Sales per square foot plunged by 37% compared with the same time two years ago, averaging €203.64 for the quarter.

REI chief executive, David Fitzsimons said: “The most telling information coming out of the quarter four figures was the extent to which consumer sentiment dictates the overall health and prosperity of the industry.

“Consumers very obviously contained their spending in anticipation of the budget with November proving the weakest trading period of the quarter and one of the weakest of the entire year.”

Overall Irish retail sales finished down 14% in 2009 compared with quarter four the previous year.

Despite falling sales for 23 consecutive months, a slow down in the rate of decline indicates that a return to like-for-like growth in late 2010 is likely according to Mr Fitzsimons.

“While retailers appear to be keeping a handle on wage costs via extensive labour rationalisation programmes, rent cost asa percentage of sales continues to be the single biggest issue facing the industry.

“As we enter 2010, our agenda remains unchanged. We will again be calling on the Government to intervene directly in modifying rent and wage costs and taking every step possible to boost consumer confidence by whatever means it has at its disposal,” he said.

REI said rent cost as a percentage of sales was almost 10%, running 27% higher than the same period in 2008 and 41% higher than Q4 2007.

Fourth quarter sales 2009 V 2008

* Average: -14.58%.

* Footwear: -11.73%.

* Giftware/homeware: -17.91%.

* Grocery: -10.87%.

* Jewellery: -14.74%.

* Ladies fashion: -16.61%.

* Menswear: -21.24%.

* Pharmacy: -8.99%.