Slow retail growth lags behind general recovery
While sales volumes are up by 5.1%, sales values remain significantly behind that, Ibec’s Retail Ireland Monitor for Q1
Print13 May 2015
There was a lack of real growth in the Irish retail sector during the first three months of this year. This is according to Ibec’s Retail Ireland Monitor for Q1, published on 11 May.
Director of Retail Ireland Tom Burke said: “Despite improvement in key economic indicators across the general economy, the retail sector continues to lag behind. While sales volumes have improved, sales values remain sluggish, finishing just 0.9% ahead of the same period last year.”
Burke said: “It would appear that shoppers are still extremely price conscious so while sales volumes are up 5.1%, the increase in the value of sales is significantly below that. This suggests that Irish retailers are discounting heavily to drive footfall and sales in store. Interestingly, the report highlights that certain categories such as furniture and homewares are outperforming the general retail sector largely as a result of the release of pent up demand, while others including supermarkets, books, news and stationery continue to struggle”.
Despite strong economic growth, it would seem that value for money is still the key determinant for Irish consumers. “Retailers face increasing cost pressures. Firstly, a weak euro has resulted in higher import costs for those retailers sourcing products from outside the Eurozone. Secondly, retailers are very concerned about proposed increases in other costs, specifically wage increases. With recovery in retail still fragile, Retail Ireland warns that any increased costs could further destabilise a sector which has endured a torrid last six years and remains significantly challenged,” Burke added.
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