Otago and Nelson lead spending growth in December

Otago and Nelson lead spending growth in December

Auckland, Thursday 8th December 2015: Two South Island regions recorded the highest growth rates through the Paymark network in December. Otago took the lead with an 8.5% increase on December 2013 with Nelson following closely behind, up by 8.2%.

Spending in Otago totaled $294 million compared to $271 million in 2013, bringing in an extra $23 million for the local economy. Nelson’s economy received a boost of $9 million last month with shoppers ringing up $112 million compared to $103 million in December 2013.

A total of $5.3 billion was spent via Paymark’s network during the busiest month of the year, up $300 million on December 2013, showing 5.4% growth. During 2014, Paymark recorded the highest growth rate in spending since 2007, processing transactions with a value of $52.3 billion, up 6.6% on the previous year.

Paymark’s Head of Customer Relations Mark Spicer says the national growth is strong, given that low fuel prices will be having some impact.

“The strong growth in Otago and Nelson could reflect a combination of factors,” says Spicer. “Both regions are home to popular tourism hotspots attracting both domestic and international visitors. Additionally, we’ve seen strong and consistent growth in the accommodation and food and beverage sectors throughout 2014.”

The value of transactions for 2014 was up by 11.6% in the accommodation sector and 11.2% in the food and beverage sector which includes cafes, restaurants and bars, when compared to 2013.

“With a strong year for tourism in these areas plus Christmas spending, both Otago and Nelson are likely reaping the benefits of this combination.”

“Early in December, New Zealand won the ‘top country’ category in the 2014 Telegraph Travel Awards for the third year in a row. That accolade is likely to be having some influence on spending in certain areas and sectors”, says Spicer.

Other regions that were strong in December were Auckland/Northland and the Bay of Plenty with a 5.9% increase in spending for both. Total spending for these regions totaled $2.1billion and $358 million respectively.

Key statistics for December 2014:

• Christmas Eve 2014 was Paymark’s biggest day on record with $263.5 million processed through the network, up by an unprecedented 10.5% on 2013.

• The hardware, building and garden supplies sector was up by 13.7% on December 2013.

• Spending on accommodation was up 11.8%.

• Food and beverage services (excluding supermarkets) but including cafes, restaurants and bars showed a strong 10% growth.

• Supermarket and grocery stores were also strong with spending up by 10.6% on December 2013.

• Furniture, flooring and homeware stores were up by 6.7%.

• Spending was slower at Department stores (1.85%), clothing, footwear and personal accessories (1.6%) and in electronic goods (0.5%).

Paymark also recorded its 13 billionth transaction on Saturday, 27th December 2014 in Taupo at 15:52:13.

Paymark’s 12 billionth transaction was recorded on January 31st 2014, only 11 months beforehand. Spicer says achieving this milestone in less than 11 months may reflect the growth in contactless transactions over the past year.

Note: History shows that changes in Paymark transactions are not always consistent with retail sales, as released by Statistics NZ, but they do provide a wide measure of household spending. Some Paymark transactions occur through merchants not currently considered part of the retail sector. Some electronic sales are transacted through other switching houses and there remains spending with cash, cheques or other non-electronic means. Paymark spending includes any GST paid to the merchant, and also includes cash withdrawals at the time of purchase.

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