ISME: State has ‘failed’ retailers

The Government has failed retailers according to their representative bodies following a further fall in retail sales in May according to figures released by the CSO.

The Irish Small and Medium Enterprises Association (ISME) said that the latest fall in sales in May of 1.7% were evidence that the sector was on its knees and needed a policy group set up to aid the sector.

ISME CEO Mark Fielding said: “It is time that our government realised that the retail industry is not just a small number of over-dominant grocery multiples; it comprises of every shop and store in every street, village and town.

“Without a clear and properly targeted policy initiative we will see many more small retail outlets close.”

Retail Ireland echoed calls by ISME for the Government to intervene and establish a working group to help the sector.

Retail Ireland director Stephen Lynam said that the retail sector was in as poor a state as at the beginning of the recession.

“Sales are now down on an annual basis for three months in a row. What we hoped was just a blip has become a trend. This data comes on foot of poor consumer spending figures for the first quarter of the year, released yesterday, that showed the biggest quarter-on-quarter drop since the pit of the recession in 2009,” he said.

Merrion stockbrokers economist, Alan McQuaid said that a number of factors were contributing to the continued decline in retail sales.

“The main factor impacting on consumer demand has been the continued net decline in real disposable incomes, an increasing tax burden and an erosion of transfer income.

“As well as that, the personal savings rate has remained elevated as households have striven to reduce their high level of indebtedness and to adjust to a sharp fall in personal wealth. These factors will continue to restrain consumer demand for the foreseeable future,” he said.

Mr McQuaid said that there was a glimmer of light at the end of the tunnel with employment figures improving mildly there could be an improvement in the amount of disposable income in the second half of the year.