Retailers remain hugely concerned about Covid disruptions, staff shortages and inflationary pressures entering the new year, despite latest figures showing positive consumer spending patterns.
Latest CSO data show monthly retail sales volumes rising for the first time in three months in November, albeit at a rate of 0.6%; with clothing and footwear sales soaring and online purchases gaining in popularity.
Separate figures, from the Central Bank, showed a 14% monthly increase in total card spending – which includes ATM withdrawals – in November. Within that data, a 20% month-on-month increase in retail spending was noted, with online card spending up 21% on the previous month.
However, retail groups have previously warned that the industry remains fragile, inflation will bite harder this year and any real spending boom may not be seen until next summer at the earliest.
“The figures for November reflect the more normalised trading pattern we went through compared to November 2020, with all retail trading fully two months ago,” said Retail Excellence managing director Duncan Graham.
“Customers had lots more choice in terms of how they shopped this Christmas and business was spread across physical stores, online and through click and collect. The strong bounce we saw in November is an indication that we have not ‘fallen out of love’ with the high street and consumers see ‘retail therapy’ as an integral part of Christmas," he said.
"However, retail and hospitality work ‘hand in glove’ and the restrictions we saw introduced at the end of November coupled with the Omicron variant severely impacted the way customers shopped in the final few weeks of the year," Mr Graham said.
Arnold Dillon, director of the Ibec-affiliated group Retail Ireland, said the outlook for the sector for this year remains “broadly positive” given the strength in the economy and in the employment market.
He said the hope remains to be back to a more normal trading environment soon, but that inflation and continued Covid restrictions remain concerns – with labour market shortages and absence rates amongst retail staff “a massive immediate hurdle”.
Mr Dillon said there have been positive trends for retail since last summer, with some savings being released into the economy. But, while many retailers had a relatively good Christmas, the current Covid restrictions meant not all benefitted, with significant drops in footfall recorded in city centre locations.
Retail Excellence recently said it is “inevitable” that retailers will have to pass on the rise in the cost of goods to consumers through in-store price hikes. However, it also said the sector can still recover this year if the right supports are put in place.
Meanwhile, eurozone retail sales volumes – as a whole – grew by 1% in November, according to latest figures from Eurostat.