The Australian Retailers Association (ARA), in partnership with Roy Morgan, projects a remarkable $9 billion spending boost in Australia during the final week leading up to Christmas. This surge is expected to elevate the total spending for the November-December 24 period to $67.4 billion, marking a 1 per cent increase from the previous year.
During this festive season, expenditures on food are predicted to hit $27 billion, showing a 3.2 per cent rise from last year. However, the spending on household goods and hospitality is anticipated to decrease by 3 per cent and 1.5 per cent respectively, largely attributed to the ongoing cost-of-living challenges.
Each state and territory in Australia is forecasted to experience a rise in year-over-year sales, with South Australia leading at a 2.6 per cent increase.
ARA CEO Paul Zahra commented on the trend, noting that November’s strong trading, spurred by exceptional deals and early Christmas shopping, has contributed to the upbeat pre-Christmas spending forecast. Despite this, Zahra indicated a generally “subdued Christmas” expectation.
He elaborated that the modest uptick in spending is largely due to factors such as supply chain-induced price hikes, especially in the food sector, and Australia’s growing population. Zahra pointed out that excluding these elements, the overall Christmas spending trend appears to be on the decline.
Zahra also highlighted the critical importance of the December period for discretionary retailers, for whom up to two-thirds of annual profits are typically generated. He underscored the lingering uncertainty surrounding this key trading period.
