Retail sales expected to improve in summer

11 October 2010

Retail sales expected to improve in summer

Retail sales are expected to improve in October and into the summer months, according to KPMG.

Electronic spending figures released today by Statistics New Zealand show that core retail spending in New Zealand has increased in September, with credit card spending down.

KPMG, GST Partner Peter Scott says, “While some of the increase reflects the spending ahead of the GST rate increase (e.g., furniture, appliances), this increase looks modest compared to 1989 when there was a significant surge in consumer purchases prior to the rate increase. For instance, in June 1989, spending on appliances was 35 percent higher than it had been a year earlier.
“While the data reflects the current cautiousness of consumers, with various confidence indicators in New Zealand trending upwards, I would expect these figures to improve slightly for October and then again as we enter the summer months. I would expect the number of people spending to increase, without the average spend trending upward necessarily.

"Retailers should be spending more time planning strategies to encourage consumer spending as we enter the summer months - and focusing on their conversion of browsers to customers. I would expect a flurry of Spring sales to hit the streets and for retailers to continue to get creative with their marketing spend. One thing is clear, the retailers who are planning well ahead, will be the ones who reap the rewards.”

ENDS

About KPMG

KPMG is a global network of professional firms providing Audit, Tax and Advisory services. We operate in 144 countries and have 137,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss cooperative. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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