Boxing Day sales may be too late

Photo / Sarah Ivey.

Forget waiting for Boxing Day sales - some retailers are already advertising sales with discounts of up to 70 per cent.

Stores along Auckland's Queen St have banners up and Christmas songs blaring and, with only seven shopping days to Christmas, one retailing group is wondering what might be left for sale on Boxing Day.

Retailers Association chief executive John Albertson was predicting a hectic weekend for retailers.

"It's the last daytime opportunity for families to get shopping done. I'd expect this weekend to be huge."

He said many people did not realise this weekend was the last one before Christmas, which falls on a Saturday this year.

A walk along Queen St reveals a mass of silly season advertising.

Valley Girl women's fashion store is advertising up to 70 per cent off in an "end of year" sale, while Kathmandu has up to 60 per cent discounts. Strandbags is advertising between 30 and 50 per cent off and Snow Gum outdoor store has 50 per cent off everything.

Mr Albertson said the sales had come earlier this year, and were more aggressive than usual - a sign that retailers were competing for consumer dollars.

"The market this year has been as competitive as I've ever seen it... margin has been hammered pretty heavily. It's been one of those years where everyone's had to compete like mad."

If stock sold before Christmas Day, it raised questions about how Boxing Day sales could play out, he said.

"The more that goes now, the less there's going to be on Boxing Day.

"It's impossible to predict. The retailers will have a bit of an idea what they're going to be leading with on Boxing Day as this week unfolds."

Mr Albertson is expecting slight growth (about 2 to 2.5 per cent) compared with last year, when shoppers spent $4.3 billion last December through the Paymark network, which processes 75 per cent of the country's electronic transactions. This would be 3.9 per cent up on December 2009.

However, shoppers usually leave their spending until the last three days before Christmas.

"It's very hard to pick because so much of it does happen in such a relatively short space of time."

Meanwhile, a Research New Zealand phone poll of 500 people also suggests that spending will be subdued this Christmas, with 35 per cent of respondents saying they will spend less on Christmas this year. Just 8 per cent said they would be spending more.

Thirty-one per cent said they would spend less on their holidays than they did last year, while 14 per cent felt they would spend more.

Research New Zealand director Emanuel Kalafatelis said the results suggested a cautious mood among comsumers, which would probably be reflected at the cash register.