Australian retailers remain pessimistic about the first quarter of the year, concerned by slowing demand, a survey shows.

The Dun & Bradstreet national business expectations survey shows sales and profit expectations were down year-on-year, despite the sector showing a strong performance in the September quarter.

Dun & Bradstreet chief executive Christine Christian said competition from online sellers was an increasing concern for retailers.

"High street retailers are facing increasing competition from online stores, compounded by the fact that they are dealing with overheads not applicable to e-commerce," she said.

"The situation is likely to deteriorate for those retailers unwilling or unable to adapt to changing consumer behaviour."

More than half (55 per cent) of retailers surveyed named slowing demand as their main concern for the year ahead, with 56 per cent saying they expected online retail to impact mainstream retail businesses.

Christian said a general negative outlook for the global economy was also impacting on expectations.

"As the world contemplates a second recession, it is inevitable that local businesses will begin to question how this may affect their business in the coming year," she said.

"A second global recession will undoubtedly have consequences for sectors of the economy."