Shillong, October 5: The Australian Retailers Association (ARA) projected on Thursday that pre-Christmas spending in 2023 is likely to remain largely unchanged from the previous year, primarily due to citizens tightening their belts amidst a cost-of-living crisis.
As per IANS, initial forecasts from ARA and Roy Morgan suggest that the total spending during the Christmas trading period, from November to December 24, will reach A$66.8 billion, a slight increase of 0.1 percent compared to the previous year’s figures, according to reports from Xinhua news agency.
The bulk of this expenditure is expected to be allocated to food, accounting for A$26.7 billion, with a notable increase of 2.4 percent compared to the previous year. Meanwhile, department stores and various retail sectors such as recreational goods, books, and cosmetics anticipate a growth of 2.9 percent and 1.7 percent in sales, respectively.
However, categories like hospitality, household goods, and clothing are bracing for reduced spending leading up to Christmas.
Sales growth of 1.2 percent is expected in both South Australia and the Australian Capital Territory, followed by Tasmania, Western Australia, Northern Territory, and Victoria. In contrast, spending in Queensland and New South Wales is predicted to decline.
ARA CEO Paul Zahra pointed out that the softer spending on discretionary items is anticipated due to prevailing economic conditions and the ongoing cost-of-living challenges. He also highlighted that the marginal increase in spending is partly attributed to supply chain price hikes, particularly in the food sector, and an overall population increase in Australia.
Zahra cautioned, “Excluding these factors, overall Christmas spending is showing a decline. For many retailers dealing in discretionary items, the Christmas trading season represents a significant portion of their annual profit, making this year a period of business uncertainty.”