First third of 2013 reveals upward spending trend

May 7, 2013

First third of 2013 reveals upward spending trend

Figures released today by New Zealand’s leading payments provider Paymark, show a positive start to the year, with spending over the first four months of 2013 up 3.9 per cent on the same period in 2012.

In addition, the seasonally adjusted ex-fuel total spend through the Paymark network increased 2.1 per cent from March to April, more than offsetting the decline of March, which occurred due to the ‘Easter effect’.

Paymark Head of Sales and Marketing, Paul Whiston says the four-month trend gives a clearer picture of how spending is tracking in comparison to the monthly trends, which can be more volatile.

“There have been several contributing factors impacting monthly spending over the past four months. In January we saw a high 5.1 per cent year-on-year increase, exaggerated by January 2012 having an extra Sunday than January 2013, typically a low spending day.

“In February we saw a much lower 1.8 per cent annual spending increase, due to the leap day in February 2012, essentially an extra day of spending than in February 2013. March growth was also below average due to Easter falling during March instead of April this year. Conversely April’s annual growth result was up a strong 5.9 per cent year-on-year.

“Balancing the results over January to April 2013 levels these seasonal effects to reveal an annual growth of 3.9 per cent, up on the 3.3 per cent average of 2012; so a positive start to the year for retailers in general,” says Whiston.

Paymark, which processes around 75 per cent of all electronic transactions in New Zealand, believes the higher national average growth rate is being driven, in part, by the Canterbury recovery. Spending in Canterbury was running 6.9 per cent above year-ago levels in the first four months of 2013, up from the 5.6 per cent average of 2012.

Other regions that have seen positive spending increases over the first third of the year are Otago (+4.5%), Marlborough (+5.0%), Hawke’s Bay (+4.9%) and Waikato (+4.5%). Auckland/Northland has also experienced spending growth (+4.0%) above the national average, but only slightly above the 3.9 per cent growth averaged in the region in 2012.

Sectors where spending has noticeably accelerated this year include food and liquor (+4.1%) and pharmacies (+6.0%), plus building and hardware (+9.6%) where spending has extended the growth pattern of 2012. Although still modest, spending is now increasing again amongst big ticket retail stores (+2.8%), such as appliance and sporting equipment stores.

Another pick-up over the past four months has been within the hospitality (+4.8%) and accommodation (+2.1%) sectors. This is partly due to Kiwis using their cards more and partly due to the gradual recovery following the low spending pattern after the 2011 Rugby World Cup.

Nationwide during April, the number of card transactions was 6.2 per cent higher than a year ago, with credit card usage up 10.5 per cent and debit card usage up 4.9 per cent.

PAYMARK Regional Data (April 2013 versus same month 2012)

Volume (million transactions)

Value of spending ($millions)

Region Last Year

Current Year
Volume Difference Last Year

Current Year Value Difference

Auckland/Northland 29.33 31.40 7.1% $1,464.2 $1,567.2 7.0%
Waikato 5.60 5.85 4.3% $267.6 $279.3 4.3%
BOP 4.80 4.89 1.9% $241.2 $243.0 0.8%
Gisborne 0.69 0.73 6.4% $32.1 $33.2 3.5%
Taranaki/Taupo 1.82 1.86 2.1% $86.1 $87.8 1.9%
Hawke’s Bay 2.08 2.22 6.8% $100.3 $106.9 6.6%
Wanganui 0.84 0.86 2.3% $37.5 $37.6 0.3%
Palmerston North 2.41 2.48 3.0% $122.8 $129.5 5.5%
Wairarapa 0.70 0.73 3.0% $33.6 $34.5 2.9%
Wellington 8.12 8.66 6.7% $368.4 $388.1 5.3%
Nelson 1.42 1.50 5.9% $71.2 $75.7 6.3%
Marlborough 0.81 0.85 5.4% $41.9 $44.9 7.0%
West Coast 0.52 0.52 -0.8% $29.5 $28.3 -4.0%
Canterbury 8.06 8.86 9.8% $403.9 $444.7 10.1%
South Canterbury 1.16 1.23 5.4% $64.6 $67.6 4.6%
Otago 4.13 4.34 5.1% $203.2 $212.9 4.8%
Southland 1.71 1.81 5.3% $91.4 $94.1 2.9%
New Zealand 74.22 78.79 6.2% $3,694.4 $3,912.9 5.9%

ENDS

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