Shops hit by shock fall in December spending
Blow to traditional retailers as shoppers go online
There was a surprise fall in spending in shops in December, despite other signs the economy is getting back on track.
Experts said the fall-off indicates that consumers did the bulk of their Christmas shopping in November, while there was also a significant shift to online buying.
Shoppers were prompted to do much of their Christmas buying earlier than usual by the growing popularity of marketing events like Black Friday and Cyber Monday, both of which fell in November last year.
Retailers said online shopping sucked sales out of shops.
Central Statistics Office figures show the volume of sales was down 0.9pc in December when compared with the previous month.
Sales had risen by 9pc in November, when compared with October.
However, the volume of sales in December was up more than 6pc when compared with the same month a year previously.
The drop-off in December bucked the trend of previous years, where there was usually a surge in retail sales in the final month of the year compared with November.
Buying online is also thought to have impacted on shops. However, online sales are not captured in the CSO retail sales figures.
This means sales here by big online retailers like Amazon, Apple and online fashion retailer Boden are outside the scope of the CSO figures.
Economics lecturer at University College Cork, Seamus Coffey, said retail sales were strong in November.
Consumers are likely to have been prompted to buy the likes of electronics goods that month due to the publicity surrounding 'Black Friday' and 'Cyber Monday'.
"There is usually a massive jump in sales in December when compared with November.
"It is likely that Christmas shopping was brought forward into November. People bought earlier rather than doing all their buying in December," he said.
The chief executive of business lobby group ISME, Mark Fielding, said there was a huge change in shopping habits, with consumers moving away from shops to buy online.
"Consumer spending habits have changed, with many preferring to source bargains from multinational e-tailers instead of shopping locally."
Mr Fielding claims that high costs mean that indigenous businesses cannot compete with heavily discounted prices for online goods.
"Retail is a changing industry, with customers often never setting foot in a shop to make purchases," he said.
He claimed the 6pc increase in the national minimum wage, which came into effect this month, will increase costs for retailers.
Goodbody economist Juliet Tennent said there is evidence of retail discounting, but the overall value of retail sales rose by 5pc in 2015, indicating that conditions have improved in the retail sector.