Sales up but little joy for retailers

Sales of hot beverage and home/giftware products helped drive a marginal boost in retail sales during the final quarter of 2012 but little, if any, relief was felt by shop owners.

New data from industry representative Retail Excellence Ireland shows that overall retail sales grew by 0.21% on a year-on-year basis, during the final three months of last year.

While the festive period had a natural positive effect, the budget announced in early December balanced that out, while many stores choosing to discount goods proved to be something of a double-edged sword.

“The slight increase in retail sales during the fourth quarter is very welcome. However, the sector still remains fragile,” REI chief executive David Fitzsimons said. “It’s no surprise that December saw an increase of 0.31%, due to the budget announcements complete and consumers regaining confidence to spend again.

“Unfortunately, home-dependent sectors such as furniture and flooring continue to suffer, due to the lack of a functioning residential property market. It is noticeable that many retailers discounted in December to generate sales. Thus, while consumers responded to value, the retailer suffered margin erosion,” he added.

REI’s data shows November as the worst-performing month of the quarter, with sales falling by nearly 0.2% on a year-on-year basis.

Pre-budget speculation in October, causing a decrease in consumer sentiment, was offered as the main reason for this. December’s 0.31% increase was seen as a major improvement.

The most recent retail sales figures from the CSO covered only the month of November and gave a slightly different reading, suggesting a 1.1% monthly fall and an annual decrease of 0.5%.

Excluding vehicle sales, those figures came in at 1% and 0.3% respectively.