Early December rush short-lived

Media Release

Date: 14-Dec-10
Embargoed Until:

Early December rush short- lived

November’s positive retail cheer carried through into the early part of December, with some sectors posting increases over 10 per cent in the first three shopping days. This cheer was short-lived however, as sales across the country dropped off after December 3rd according to the latest figures from Paymark.

The three-day spending spree (Wednesday – Friday) pushed a total of 8.4 million transactions through the Paymark network, up 7.4 per cent on the same three days in 2009. The value of these transactions was up 8 per cent, and represented a total spend of $ 435 million.

EFTPOS terminals in supermarkets, restaurants/cafés and handyman/decorating stores were working overtime during this period, posting annual growth above 10 per cent.

Geographically, the spending surge was felt most in the North Island with annual growth averaging 8.3 per cent. This was in contrast to the South Island, which only grew 4.4 per cent during the three-day period.

While the first three days of the month saw bumper sales, spending over the first seven days of trading tell a more subdued story, with an annual growth rate of 5.2 per cent – similar to the growth rate in November. The volume of transactions was also similar to last month - steady at 4.9 per cent.

By the weekend, the shopping spree had all but faded, with weekend sales slowing to just 1.8 per cent (by value) and 2.5 per cent (by volume) – levels that mirror mid-year trends.

Paymark CEO, Simon Tong, says that the early spend-up and subsequent lull in December sales to-date is another indicator that the retail landscape remains patchy.

“Last month, appliance, recreational and electronic stores were slow and in the first 12 days of December it’s apparel, appliance and gardening stores that are experiencing lower sales when compared to the same time last year.

“When you look at the first 12 days of the month as a whole, we see that spending is up 4.0 per cent on the same period in 2009. This is a lower growth rate than in October and November 2010. Even though sales were strong in November, we saw mixed results across the retail sectors, and this trend has continued into the first half of December,” says Simon Tong.

“In the past we have seen patterns similar to this, with spending coming late in the month and if tradition stands, we’ll expect to see a final rush in the last two or three days prior to Christmas,” he adds.

By region, Wellington, the West Coast and Nelson are experiencing slow sales, with modest spending growth of 2.5 per cent, 1.6 per cent and 1.9 per cent respectively.

ENDS

About Paymark:
In November 2009, Paymark celebrated a significant business, retail, and economic milestone with the celebration of its 20th birthday. Since its inception in 1989 when three banks came together to form Electronic Transaction Services Limited (now known as Paymark Limited), Paymark has grown to become an integral part of New Zealand’s economic landscape with arguably the best EFTPOS system in the world.
Quick facts:
- By March 1990 volumes through the network exceeded 1 million transactions a month
- In 1994 the company increased its computer processing power to accommodate volumes exceeding 10 million transactions a month
- 28 August 1996, Paymark makes history by installing an off-shore EFTPOS terminal at a general store, Scott Base, Antarctica
- In 1998 Paymark passed another milestone as the 1 billionth EFTPOS transaction was processed
- More than 73,000 merchants and 100,000 terminals are currently connected to the network that is now 3DES and EMV compliant. Today, the Paymark network processes over 75% of all electronic transactions in the New Zealand retail market on behalf of more than 50 card issuers and acquirers.

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