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Small Retail Spend Increase Not Enough To Boost Sector
Strong signals on controlling the cost of living, combating retail crime and improving infrastructure are on Retail NZ’s wish list for next week’s Budget announcements.
Although the Retail Trade Survey for the March 2024 quarter, released yesterday by Stats NZ, shows a small increase in sales compared with the previous quarter, it is not enough to improve the outlook for retail, Retail NZ Chief Executive Carolyn Young says.
The 0.5% lift comes off a low base and does not reflect the population increase or the busy international tourism season. It is only 0.6% up on the same quarter of 2023 and the volume of goods sold is down 2.4% against the same period.
“There’s still a long way to go before we see any light at the end of the tunnel. Retailers are struggling with inflation and soaring costs, along with a lack of consumer confidence,” Ms Young says.
“Retail NZ members are telling us that they have been tightening their belts in anticipation of slow sales and uncertainty. We are hoping the upcoming Budget will help restore confidence to the marketplace and provide a pathway out of recession.”
She hopes the promised tax cuts will lead to a lift in consumer confidence. Clear policies to support business are also required from the Government.
In particular, Retail NZ is looking for investment in Police, which is critical to fight the current wave of retail crime. This would need to be supported by funding for mental health, education and social services, as well as the planned Youth Military Academies.
“Retail crime cannot be solved by police alone. It’s a much wider socio-economic challenge that must be addressed by a range of agencies,” Ms Young says.
Retail NZ is also keen to see indications in the Budget that New Zealand’s aging infrastructure is being upgraded.
Ms Young points out that the Cook Strait ferries are vital for the transport of goods throughout New Zealand.
“We really need to see a signal of funding and a timeline for renewing the current fleet to bolster business confidence in our supply lines.”
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