Hey big spenders: Tauranga's retail spending hits $187 million in a month

New data shows retail spending in Tauranga sky-rocketed over the last year.

Economic experts said the trend was a sign of business confidence and a growing population, but a budget advisor warned some consumers are racking up big debts.

Shoppers swiped their cards for more than $187 million of purchases from Tauranga retailers during October, according to figures from consumer spending analysis company Marketview.

That was up 7.3 per cent on the same month last year, led by significant spending increases on hardware and homewares, and bars, cafes and restaurants - categories where sales totalled more than $14 million apiece.

Tauranga Chamber of Commerce chief executive Stan Gregec said the figures reflected the business boom happening in the city, but did not tell the whole story.

He said some pockets of retail were struggling, particularly smaller businesses in the CBD and Greerton affected by construction and roading changes.

"Generally, Tauranga is performing strongly on multiple economic indicators at the moment, and we expect this will continue for some time yet."

Priority One communications and projects manager Annie Hill said as business confidence peaked, consumer confidence followed, which contributed to the spending increase.

People felt they had secure employment and were more likely to have disposable income.

Investment in retail, such as the developments at Bayfair, Tauranga Crossing and in the CBD, showed investors were also feeling bold, said Hill.

Hospitality New Zealand regional manager Alan Sciascia said the growth illustrated Tauranga's healthy tourism market for domestic and international tourists.

Growing population and housing expansion also added to the "reasonably vibrant" local economy.

Sciascia predicted the new growth would flatten out.

Greenslades Furniture owner Andy Greenslade his business had its best October ever this year.

"It was phenomenal."

Spending was up 18 per cent in October, and 30 per cent in November compared to the same months last year.

He said it was usually busy in summer but he had not experienced a boom like this in 25 years of operations.

Mitre 10 Mega Tauranga manager Wayne Mansell said business had been going strong during October as the dry weather prompted people to get stuck into home improvement projects.

He expected the strong business to continue, given the region's popularity and love of DIY.

Not every business in Tauranga, however, had enjoyed the spending splurge.

Lonestar Tauranga owner Trevor Donaghy said while December was looking strong, the winter had proven a challenge for some businesses in the area.

Donaghy said CBD roadworks and construction had put customers off, and there was a noticeable difference in business when The Strand was closed compared to when it was open.

Budget Advice Tauranga manager Diane Bruin said there had been a large increase in short-term borrowing, which could result in high-cost charges when a client could not afford the repayments.

Some clients were unable to pay their debts leading some to look at insolvency options.

She urged people to be careful using credit cards, and ensure they could pay them off.

"$2500 will cost you $4724 if you pay the minimum amount per month."

First week of Christmas spending

Paymark data of card transactions in the Bay of Plenty between December 1 and 7

- $77 million spent
- Increase of 0.2 per cent from 2017

Source: Paymark

Retail spending booms in October
October card spending 2018 compared to 2017

- Total spent October 2018: $187.2m,
- The spend was up 7.3 per cent on 2017, 13.2 per cent on 2016.
- Hardware and homeware spending: $14.2m, up 15.5 per cent
- Bars, cafes, and restaurants: $14.1m, up 9.5 per cent.

Source: Marketview