Clothing, footwear and accessories retail sales fell by 1.8 per cent in December 2024 compared to the month prior, new data from the Australian Bureau of Statistics (ABS) revealed.
Total sales fell by $55 million, with clothing retailing down $39 million and footwear and other personal accessory retailing down $15.9 million.
Despite the month-on-month slip, fashion sales between December 2023 and December 2024 rose by 5 per cent, albeit against a larger monthly drop in fashion sales between November 2023 and December 2023 - then down $142 million.
Department store sales have fared better, up 0.4 per cent month-on-month and by 1.6 per cent year-on-year.
The largest rise year-on-year across the six core retail categories was household goods, up 7 per cent, and also includes the largest monthly rise by 1.6 per cent.
Overall, sales across the retail market in Australia – including food and dining – contracted by 0.1 per cent month-on-month and lifted 4.6 per cent year-on-year.
The monthly drop comes after growth of 0.7 per cent in November 2024 and 0.5 per cent in October 2024.
“Retail spending held firm following strong growth in recent months with promotional activity stretched across the quarter,” ABS head of business statistics Robert Ewing said.
“Cyber Monday fell in early December and boosted spending to begin the month, particularly on discretionary items like furniture, homewares, electronics and electrical items.”
Cyber Monday also drove more spending on household goods as consumers took advantage of discounts on big ticket items, Ewing added.
Alongside the largest monthly fall in fashion retail, other retailing – which includes beauty and hairdressing – also dropped by 1.4 per cent. Both industries had risen in November.
Industry commentary
Australian Retailers Association (ARA) chief industry affairs officer Fleur Brown said the latest yearly figures are a welcome uptick for retailers after a challenging 2024.
“December is a crucial month for retail, with many discretionary retailers making up to two thirds of their profits during the peak season period,” Brown said.
“From household goods such as kitchen appliances and electrical garden tools, to on-trend fashion items and cosmetics, it’s clear Australians rallied to the sales events and enjoyed splurging on gifts for their loved ones during the holidays.”
While these results are a relief for many, Brown added that retailers continue to have a tough road ahead as they navigate a challenging landscape with pressures exacerbated by higher business costs, supply chain demands and the ongoing toll of retail crime.
“After many years of continued pressure, we are calling on the Federal Government to show support for the sector to ensure it can grow and thrive.”
National Retail Association (NRA) interim CEO Lindsay Carroll said that positive December sales are a sign that consumer sentiment is healing, but it’s also a sign that Aussies won’t pass up a bargain.
“Discretionary spending was slack all through last year, so this boost is invaluable to retailers who rely on this spending category to get by,” Carroll said.
“The holiday season sales boost isn’t enough to carry businesses through to the quieter months of the year with conservative spending habits likely to continue.”
To combat this, retailers are urging the Reserve Bank of Australia to cut interest rates in February.
“Inflation is currently sitting within the prescribed range of the RBA,” Carroll said. “We think the Reserve Bank should consider starting the year off with a rate cut when spending is slow to bolster struggling retailers.”
Volumes are also up
Today’s data release by the ABS also includes quarterly retail sales volumes, which rose 1.0 per cent (seasonally adjusted) in December quarter 2024.
This comes after volumes growth of 0.5 per cent in September quarter 2024 and a fall of 0.2 per cent in the June quarter.
“Retail sales volumes rose for the second straight quarter, boosted by continuous promotional activity,” Ewing said.
“Sales events throughout the quarter like Black Friday and Cyber Monday saw more discretionary spending on things like furniture, electronic goods and clothing.”
Retail volumes on a per capita basis (0.5 per cent) rose for the first time since June quarter 2022. According to Ewing, the rise coincides with an easing of retail price growth and with cost-of-living relief measures.
Retail price growth (0.4 per cent) slowed this quarter, down from a 0.6 per cent rise in the September quarter, based on data from the latest Consumer Price Index.