INDEPENDENT NEWS

Pre-Christmas Spending Build Up Begins, But Patterns Are Mixed Across Retail Sectors

Published: Fri 8 Dec 2023 04:33 PM
AUCKLAND, 8 December 2023 – Consumer spending patterns were mixed in the first full week of December, with pre-Christmas shopping up for Food & Liquor, but down across most other retail sectors.
Consumer spending processed through all Core Retail merchants (excluding Hospitality) in Worldline NZ’s payments network during the first seven days of December reached $785m, which is up 1.4% on the first seven days of December 2022 and up 13.9% on 2019.
Worldline NZ’s Chief Sales Officer, Bruce Proffit, says the December build-up to Christmas has begun similarly to last year, although the experience at the sector level differs.
“The pattern of recent months continues with spending at Food & Liquor stores up and spending elsewhere generally running below 2022 levels,” says Proffit.
He notes that spending in the first seven days of December was up 6.7% amongst Food & Liquor merchants, but down 6.5% across the remaining Core Retail merchants (excluding Hospitality).
Proffit says a closer look at the retail sectors shows annual spending growth so far in December ranged from a positive pattern for Bookshops (+1.7%), Toy/Gaming stores (+2.4%) and Chemists (+8.2%) to negative patterns for Clothing/Footwear stores (-9.2%) and a large grouping of Hardware & Furniture merchants (-6.9%).
In considering how consumer spending may unfold for merchants in the coming weeks, Proffit says although these early figures reflect the longer-term trend of softer spending growth seen in 2023, retailers should still be in for some busy weeks ahead.
“The typical seasonal pattern will see spending tick up a little in the next seven days and again the week after, before a final frenzy over the last three days before Christmas Day,” he says.
“Christmas Eve this year falls on a Sunday so the peak day is likely to be Friday or Saturday – either way, both will no doubt be busy.”
From a regional perspective, spending in the first seven days of December was up strongest in Whanganui (+9.5%) and Otago (+7.4%). Spending was lower than last year in Auckland/Northland (-0.1%) Hawke’s Bay (-1.2%), Gisborne (-1.3%), Southland (-2.0%), Taranaki (-2.8%) and Bay of Plenty (-2.9%).
Looking back to November, the monthly spending total through Worldline’s payments network at Core Retail merchants (excluding Hospitality) was $3.212B, which is up 3.4% on November 2022. The annual growth rate was below that averaged in the first nine months of 2023 (+4.6%).
“Black Friday spending certainly provided the usual boost for retailers at the end of the month, but the overall trends for November continued to reflect the generally weaker growth we’ve seen over the preceding months,” says Proffit.
The fastest monthly growth rate was in Whanganui (8.1%) and West Coast (8.0%) while spending declined in Southland (-2.4%) and Gisborne (-1.9%). Spending nationally was up amongst Food & Liquor merchants (+8.0%) but lower amongst the remaining Core Retail merchants (excluding Hospitality) (-3.1%).

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