Retail Sales Plummet In Lockdown

Retail sales values fell a historic 15 percent in the June 2020 quarter during the COVID-19 lockdown, the biggest drop on record in figures going back 25 years, Stats NZ said today.

Spending on eating out, accommodation away from home, vehicles, and fuel all fell sharply in the June 2020 quarter compared with the June 2019 quarter. This was only partly offset by strong supermarket and grocery sales.

“This unprecedented fall in the June quarter was not unexpected, with COVID-19 restrictions significantly limiting retail activity,” retail statistics manager Kathy Hicks said.

“Non-essential businesses closed temporarily for about half of the quarter during alert levels 4 and 3.”

Most industries saw unprecedented sales falls in the June quarter. Sales for food and beverage services fell 40 percent or $1.2 billion in the quarter, the largest drop of any industry.

“For a team of 5 million, that is equal to each person spending about $18 a week less on eating out over the June quarter,” Ms Hicks said.

Fuel retailing had the second largest fall, down 35 percent or $770 million.

These falls were followed by:

• motor vehicles and parts retailing, down 22 percent ($729 million)
• accommodation services, down 44 percent ($418 million)
• hardware, building, and garden supplies down 16 percent ($350 million).

These falls were partly offset by a substantial increase in supermarket and grocery stores, up 12 percent ($615 million) from the June 2019 quarter. This follows a record rise of 13 percent ($665 million) in the March 2020 quarter.

“Supermarkets and grocery stores were essential services that stayed open during the lockdown, and the strong increase in sales values reflects that,” Ms Hicks said.

Sales values for the non-store and commission-based industry rose 20 percent ($94 million) in the June 2020 quarter. Online businesses were in demand during the lockdown period, providing a wide range of products and the advantage of home delivery.

Electrical and electronic goods retailing was up 5.4 percent ($49 million).

“These businesses were able to operate online under lockdown as an essential service.” Ms Hicks said.

“They provided food deliveries and electronic supplies, such as heaters or computer monitors for home office set-ups during lockdown.”

Sales volume slumps in hospitality and vehicle-related industries

After adjusting for price effects, the actual volume of total retail sales fell 14 percent in the June 2020 quarter compared with the June 2019 quarter.

Sales volumes for food and beverage services were down 42 percent. The second largest fall was for motor vehicles and parts retailing (down 22 percent).

These falls were followed by fuel retailing (down 25 percent), hardware, building and garden supplies (down 18 percent), and accommodation, (down 45 percent).

“Fuel retailing was affected partly by lower demand due to non-essential travel restrictions and cheaper prices at the pump,” Ms Hicks said.

See Consumers price index: June 2020 quarter for more information on fuel prices.

The falls in sales volumes were partly offset by supermarket and grocery stores (up 8.3 percent), followed by electrical and electronic goods retailing (up 7.0 percent) and non-store and commission-based retailing (up 19 percent).

Unprecedented falls in sales value across all regions

Retail sales values fell across all 16 regions in the June 2020 quarter when compared with the June 2019 quarter.

“The widespread regional falls coincided with COVID-19 lockdown measures and the closure of New Zealand's borders to everyone but New Zealand citizens and residents, with a few exceptions,” Ms Hicks said.

The Auckland region had the largest dollar value fall this quarter, down 13 percent ($1.2 billion). Canterbury had the next largest fall in dollar terms, down 17 percent ($516 million). While the regions with higher population numbers recorded the largest dollar value falls in the June quarter, the drops in the South Island regions were more significant to their economy.

The Otago region, including Dunedin and Queenstown, had the largest fall in percentage terms, down 27 percent ($343 million).

“The big drop in sales for the Otago region in part reflects the significant fall in overseas tourists visiting the Queenstown lakes region,” Ms Hicks said.

Other regions affected by less international and domestic tourism spending were: West Coast, down 22 percent ($33 million), Southland, down 19 percent ($89 million), Nelson, down 18 percent ($51 million), and Tasman, down 18 percent ($42 million).

Retail trade dashboard

From the June 2020 quarter, Stats NZ’s new

retail trade dashboard

makes business data easier to understand. Find out how retail industries have performed over time: view, compare, and download data for a specific retail industry or several industries, or get data by geographical area.

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