Spring is here. Spending is steady.
Find out how businesses like yours are faring and innovating in Australia in this quarterly macroeconomic update.
Spring is here – and the outlook for retailers is looking brighter.
Consumer confidence is sitting at 95.4, just off August’s 98.5 peak – the highest since 2022.
“Retailers should feel cautiously positive,” says Retail Doctor Group’s Josh Strutt. “Confidence is higher than last year, but shoppers remain selective, especially on bigger purchases, so driving value and reassurance is key.
“We naturally see a lull in spending post-Father's Day as more consumers wait for the bigger Black Friday and end-of-year sales events.”
There’s a definite change in mood when it comes to spending, too. Household spending on goods and services was up by 2.7 per cent in July, and discretionary spending was up 0.4 per cent.
Numbers to know in retail
9.22%
That’s the forecast growth in the Australia fashion retail market between now and 2033[i], according to market research company IMARC Group. That growth is largely driven by the rise in e-commerce, which is helping brands sell into remote areas or other states as well as direct-to-consumer retailers, which are delivering increasingly personalised shopping experiences thanks to data collection.
$38.3 billion
That’s how much international visitors spent on shopping, gifts and souvenirs during Tourism Research Australia’s latest reported period of 2023-2024[ii]. This is $700 million or 3.8 per cent higher than the previous period of 2022-23.
994
The number of pay rates outlined in the General Retail Industry Award. The confusion for retailers has been highlighted by the Federal Court of Australia’s recent judgment that found supermarket giants Coles and Woolworths collectively liable for more than $1 billion of underpayments to workers.
“This highlights just how compelling the case for award simplification is,” says the Australian Retailers Association (ARA)’s Chris Rodwell. “The GRIA is incredibly difficult for employers to understand.”
Recent retail innovations
Harnessing the sun
Wesfarmers has embarked on a major project to install solar panels, battery storage and EV chargers at its Bunnings and Officeworks stores. With a $100 million loan from the government’s Clean Energy Finance Corporation (to be paid back over seven years) the group plans to accelerate its decarbonisation plans.
First Nations retailing
A national industry body for Aboriginal and Torres Strait Islander businesses in the retail sector has been established. Titled Aboriginal Retail Australia (ARA), the not-for-profit organisation will advocate for the needs of First Nations retailers, strengthen the visibility of Aboriginal-owned businesses, and open opportunities for Aboriginal-owned products to reach shelves nationwide.
Next-gen sports store design
Sports stores have traditionally been better known for function rather than form, but that seems to be changing as aspirational, design-led sports stores open around Australia. Take cycle brand MAAP. Step into its Collingwood store, with its polished concrete and minimalist shelves, and you’d be forgiven for thinking you were in an upmarket boutique rather than a cycling store. Up There Athletics is similarly design-focused, describing its aesthetic as “strong athletic brutalism”.
Mecca megastore
The opening of cosmetics giant Mecca’s new flagship store in August has triggered speculation about a turning point for Melbourne's post-pandemic CBD. Around 20,000 people attended the grand opening, with some eager shoppers queuing up in Bourke Street from 4am. The retail vacancy rate in central Melbourne stands at 5.5 per cent[iii], after peaking at 27.9 per cent in 2021.
Sources: 1: Trading Economics 2: Australian Bureau of Statistics 2: The Guardian 4: Roy Morgan 5: NielsenIQ 6: Fair Work Ombudsman
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