Editorial: Shoppers need to splash cash

By Andrew Austin


It has been a tough old time for retailers, but many are pinning their hopes on a Christmas splurge to get them over the line.

The latest Statistics NZ figures show total retails sales were down in the region in the three months to September 30.

Napier sales dropped by 5 per cent, while shoppers spent 2.1 per cent less at Wairoa, Hastings and Central Hawke's Bay retailers.

The year-on-year comparison from the Quarterly Retail Trade Survey makes for even worse reading with Napier sales down 39 per cent, or about $122 million, between the September 2012 and 2011 quarters.

Sales for Wairoa, Hastings and Central Hawke's Bay fell 5.2 per cent year-on-year.

The 39 per cent year-on-year drop for Napier is simply shocking and is a situation that cannot be allowed to get worse.

There is an argument that the Rugby World Cup was on last year so there was more spending by tourists and locals, but that should not be an excuse.

The local business association and retailers need to come up with a strategy to stop a further dramatic drop.

Nationally, seasonally adjusted retail sales dipped 0.8 per cent since the June quarter, but Business NZ chief executive Phil O'Reilly was fairly bullish, describing the decline as relatively minor.

The weak performance of the manufacturing sector combined with the preference for many "mums and dads" to pay off debt at the moment could have caused a much larger downturn, he said.

I suppose most households in the country have been through a period of consolidation and people are simply spending less.

In a low-wage economy like Hawke's Bay this would be even more marked.

Anecdotally, I have heard that supermarkets are seeing the same number of people coming through their doors, but each person is spending less.

People are worried about the future and their job security, so they are trying to reduce their debt as much as possible.

On the one hand debt reduction is a good thing, but on the other hand our retail sector badly needs robust trade.

Let's hope that good summer weather attracts the tourists and a Christmas splurge gets the tills ringing for our retailers.

- Hawkes Bay Today

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