With only 24 hours left the go, analysts are describing retail conditions as the worst since the early 1990’s.
According to the Australian Retailers’ Association, more than 65 percent of retailers had worst sales figures this year than in the same week, last year.
While some blame the high Australian dollar and the internet for off-shoring more sales, the stark reality is that due to huge levels of household debt, more household income is required to be funnelled into housing at the expense of discretionary spending. In addition to this, the deleveraging process is starting to take hold with many households trying to save money and pay down debt, rather than the traditional spend more than you earn-a-thon.
Retail Traders Association of WA executive director Wayne Spencer says “The larger discretionary spend is certainly being affected”
Gerry Harvey was quoted “There is a recession in retail right now. Boxing Day sales have had to come early because retailers need to sell something to pay their staff.”
“It’s a crisis, the worst in 20 years,”
The Victorian Employers Chamber of Commerce and Industry has called for further stimulus such as personal tax cuts. In early 2009, the Rudd Government gave over 8 million Australians a $900 handout to help prop up the unsustainable economy.
All eyes are now on the largest retail day of the year – Boxing Day. It will be make or break for many retailers.
» Retailers wish for Christmas miracle – The Sydney Morning Herald, 22nd December 2010.
» Traders crying out for help – The Herald Sun, 23rd December 2010.