Retail Ireland predicts best Christmas since 2008
New report suggests bounce from tax cuts will boost consumer spending by 3.5 per cent
Price discounting remains a prominent feature of the Irish retail landscape. Photograph: Frank Miller
There are fresh signs that Irish consumers are ready to spend money again, with a new report from a leading retail umbrella group predicting the best Christmas period since 2008.
However, spending will still be significantly down on levels before the economic collapse pointing to a lost decade for consumers and retailers.
The Retail Ireland Monitor published on Monday suggests that the prospect of January tax cuts has raised consumer mood and will boost spending in the weeks ahead while a weak euro will bring more foreign shoppers here in search of bargains leading to the busiest festive period in seven years.
A new survey of over 14,000 shoppers also suggests that Irish consumers are more growing more organised with 46.9 per cent saying they hope to get most of their Christmas shopping out of the way before the end of this month.
Retail Ireland said it expects core retail sales for December to reach €4.05 billion, an increase of 3.5 per cent on last year’s figure while strengthening momentum means consumer spending growth overall this year will top 3.1 per cent.
“The Christmas period accounts for over 30 per cent of total sales in certain categories of retail . . . The coming weeks will determine the overall annual performance for many retailers, and follows a broadly positive year to date,” said Retail Ireland director Thomas Burke.
He said “despite positive trends, retail sales this Christmas are still expected to be 12.2 per cent down on 2007 levels”, while sales will only be up 3.5 per cent on Christmas a decade ago, which he said underlined “the last decade’s status as a lost decade for the sector”.
Mr Burke also welcomed the Government’s decision to double the tax free allowance on gift vouchers from €250 to €500: “This progressive move will allow employers to recognise the contribution of employees to their businesses in a given year without the previously punitive tax implications.”
The figures indicate that retail sales values in the year to September were up 2.4 per cent, with a particularly strong rebound in furniture, homeware, fashion and electronics.
While growth has been strong, demand for value remains obvious with growth in sales volumes two-and-a-half times that of sales values suggesting that price discounting remains a prominent feature of the Irish retail landscape.
Retail Ireland also found out when consumers planned to do their shopping. Just under 1 per cent said they would buy their gifts in September, just under 8 per cent in October, and 42.6 per cent in December.