Good news for the retail sector! Retail NZ’s new Retail Radar report shows an improvement in sales during September with the second wave of Covid-19 restrictions being lifted.
Sales were up 20 percent last month and 45 percent of retailers have said their sales improved during the same period last year. On another positive note, retailer confidence has boosted with 78 percent of retailers now reporting they are confident that their business will survive the next 12 months.
Retail NZ chief executive, Greg Harford, says while there are positive signs, the fluctuations the retail industry is witnessing, particulalry in retailer cofidence, shows the overalll fragility of the sector.
“Retail businesses typically operate on very low net margins, and if customers are unable to shop, there are real cash flow issues that threaten the survival of retail businesses.
“Despite most Covid-19 restrictions being lifted this month online sales are still strong, with 60 percent of retailers saying online sales were up on last year. This compares to just 33 percent for bricks and mortar only retailers.”
Since the start of the year, Retail NZ has seen that 77 percent of retailers are now trading online, with 24 percent of respondents moving to online trading since Covid-19.
Additionally, 24 percent of retailers have reduced employee numbers since the start of April this year and 15 percent are planning to do so over the next coming months.
“Covid-19 is not the sole cause of these retail job losses. 21 percent of retailers that had to reduce employee numbers said they did so because of the $1.20 an hour wage increase which came into effect on 1 April 2020, at almost the same time and the entire country went into the highest level of Covid-19 lockdown.”