independent

Monday 21 April 2014

Colm Kelpie: Too early to tell if rebound is here to stay

RETAILERS have had to work an awful lot harder in recent years to persuade shoppers to loosen the purse strings and spend.

That will likely continue well into 2014 despite signs of a modest economic recovery in the second half of last year as consumer sentiment began to pick up.

But it's hard to say at this juncture if the earlier-than-usual Budget helped give the boost to retailers the Government, and the industry, were hoping for.

Sales may be up 1.7pc in November on the same period in 2012, but they're flat compared with October. When you exclude car sales, the figures look a good deal healthier. But we'll likely have to wait a few months to see if the early Budget had an effect, as monthly figures can be erratic.

What is clear is that furniture sales have risen substantially.

This may reflect necessity on the part of householders after several years of simply making do and not replacing big-ticket items in the home.

We see the same thing happening in the UK. Strong demand for new furniture and household goods has helped give the retail sector there a boost.

Sales of clothing and footwear also increased, perhaps reflecting seasonal changes. Interestingly, books have fallen significantly indicating that either we're reading less, or more likely, bricks and mortar shops are losing out to internet giants.

Some improvement in the economy, increased optimism and a fall in unemployment may be giving consumers the confidence nudge they need to open their wallets, albeit very slightly.

The figures are positive but there's little to be overly thrilled about. The sector remains about 13pc below its peak 2007 level, and business lobby groups have warned that the future is bleak.

Irish Independent

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