Financial firm Worldline NZ has reported a 2.6 per cent fall in consumer spending across its core retail merchants - excluding hospitality - in July 2024 compared to the same month last year.
Consumer spending across the category hit NZ$2.82 billion (A$2.58 billion).
Worldline NZ’s chief sales officer Bruce Proffit said there has been little change in the spending momentum at Kiwi retailers in recent weeks.
“Spending across the country was down on last year in June and continued to be down in July, although there was a small school holiday effect bump seen within the month,” Proffit said.
Proffit said the third week of July, which was also the second week of school holidays, was the worst of the month for core retail excluding hospitality merchants in the major regions.
“Some of the major regions’ spending would have moved around – along with holidaymakers – to the rest of the country but this offset was only partial as non-hospitality spending was below year-ago levels in the major regions and in the rest of the country, by 4 per cent and 0.4 per cent respectively,” he said.
“By the last week of the month, the spending decline had reverted to its current momentum – so merchants will be hoping for a positive turning point in August.”
For the month in total, regional annual growth for core retail merchants (excluding hospitality) was highest in Whanganui (up 3.7%) and Marlborough (up 2.6%).
Spending was down on last year in the remaining areas, with the largest falls being in Southland (down 7.1%), Bay of Plenty (down 6.3%), South Canterbury (down 4.4%) and Auckland/Northland (down 3.6%).
According to Retail NZ, this continues the trend of recent months and aligns with the peak body’s recent Retail Radar quarterly survey which showed that 71 per cent of members failed to meet sales targets last quarter and 42 per cent of retailers are uncertain if they can survive the next 12 months.
“While the potential change in the Official Cash Rate (OCR) provides some hope, the challenge for retailers is to survive until 2025. Cashflow is critical and some retailers have indicated they don’t think they will have the cash to buy forward stock, putting their businesses at risk,” Retail NZ CEO Carolyn Young said.
“Along with last week’s tax cuts, we hope that consumers will start feeling more confident, with a greater willingness to support local retail businesses.”