As Australia emerges from lockdown, the rollercoaster ride continues for the retail sector, with trade data from May revealing a surge in sales—the highest in 38 years of records—following a record-breaking fall in April.
Retail trade rose by a record 16.3 per cent in May, after falling a record 17.7 per cent in April in the wake of a pandemic-induced 8.5 per cent increase prior to that, in March, fuelled by panic buying.
The continuing “wild swings” are in line with what are now the all-too-familiar phases of lockdown and coronavirus containment measures, with Australians restricting their spending to supermarkets, specialty food stores, liquor outlets and household goods stores in March and April.
As stores began to re-open in May, a sense of “normalcy” returned to the retail landscape, with a rise in retail spending as consumers dipped into the household travel budget, which is dormant due to Covid-19 travel restrictions.
As restrictions eased throughout the month, the May figures show rises in every industry, but “particularly strong” rises in industries that recorded low levels of trade in April such as clothing, footwear and personal accessories.
“The monthly rise in clothing, footwear and personal accessory retailing exceeds 100 per cent but remains more than 20 per cent down on May 2019.
“Similarly, cafes, restaurants and takeaway food services rose around 30 per cent from April to May 2020 but remains 30 per cent below the level of May 2019,” the ABS said.
Commsec chief economist Craig James says the data will come as “really positive news” for consumers and businesses alike.
“It says that the economy is getting back to normal [which] will be especially heartening for smaller retailers.”
The retail trade figures come as the Shopping Centre Council of Australia revealed that 80 per cent of all SMEs have requested rental assistance in the wake of the National Cabinet’s Code of Conduct, announced in April as part of measures to offset the economic impact of coronavirus.
Sectors that account for the largest proportion of offers or agreements for rental assistance were cafes, food catering and takeaway retail (26 per cent), hair salons, beauty therapists, nail artists and shoe repairers (21 per cent) and clothing and footwear (14 per cent)—most of which bore the brunt of government gathering and trading restrictions.
Small to medium-enterprises from New South Wales, Victoria and Queensland account for almost three-quarters of offers (at 32 per cent, 29 per cent and 23 per cent respectively), with other jurisdictions expected to account for more offers and agreements in the future as negotiations continue following the recent full enactment of the code of conduct across all jurisdictions.
The progress in agreements comes as increases in consumer confidence, foot traffic and store re-openings point to improved trading conditions, reaffirmed by the preliminary ABS retail data.
SCCA executive director Angus Nardi said that rental relief was getting through to those who needed it most.
“The increasing volume of agreements illustrate that the Commercial Tenancy Code of Conduct announced by the Prime Minister on 7 April 2020 is working, and our industry and SME retailers are reaching practical solutions to address the challenging economic circumstances.”
Nardi added that shopping centre owners were committed to reviewing and appropriately responding to every rental assistance request to ensure SME retailers can thrive as more Australians return to the shops.