Retail sales stall amid fears Black Friday will hit Christmas trade
RETAIL sales were flat in October – heading into the busiest weeks of the year for the sector – and there are fears Black Friday and early sales will negatively affect trading in December.
The volume of retail sales was flat in October compared to the month before, although sales are up 5pc versus the same time in 2017, according to figures from the Central Statistics Office (CSO).
Pub sector sales were down 4.6pc during the month, despite strong tourism numbers including a surge in business visitors.
Despite the latest figures, Merrion Capital economist Alan McQuaid said the retail sector is volatile but the underlying trend is positive.
“Even with the fluctuation in consumer sentiment, overall personal spending has been positive in the past couple of years, boosted by the increase in the numbers employed in the country,” Mr McQuaid said.
The head of retailers’ trade body Retail Ireland, Tom Burke, said the shift to autumn sales has become a “double-edged sword” for the sector that is distorting the traditional Christmas trade.
“Last year retail sales for December were down 2pc on November in what should have been the busiest period for retailers, in addition, such events mean that retailers margins have become more squeezed. We are hoping we don’t see similar this year.”
He added that he would not read too much into the retail sales figures for October.
“Thus far the trend has been very positive this year, we are hoping these figures are just a blip and that it is not the start of a trend.”
The nervousness echoed rating agency Moody’s which last week said events like Black Friday are negative for retailers because they bring forward purchases from closer to Christmas, often at lower margins.
In the pub trade, Brian Foley, of the Vintners’ Federation of Ireland, said that there was “no cause for concern” at the latest figures because they just reflected one month, and were coming of the back of a very strong summer. Separate data yesterday showed Ireland welcomed 13,600 business delegates during October. That generated an additional €20.8m in economic revenue, according to Fáilte Ireland.
Fáilte Ireland CEO Paul Kelly said that business tourism “continues to be fundamental” in the country’s seasonal growth in tourism.
This is because conference delegates tend to arrive outside of the summer months.
Overall, trips to Ireland were up 7.1pc in the first 10 months of 2018 compared to the same period in 2017, with total visits now at over 9.1 million for the year.
Irish residents’ trips overseas during the same period increased by 4pc.
The total number of trips to Ireland
Retail Ireland chief Tom Burke is hoping this December will be better than last year’s
by overseas residents increased by 7.3pc to 933,500 in October – an overall increase of 63,200 compared to 12 months earlier.
Trips by residents of Britain increased by 0.1pc to 322,700, while trips by residents of European countries other than Britain increased by 5.4pc to 328,600 during October.
There was a big jump in trips by residents of US and Canada to Ireland during the month, which increased by 20.2pc to 228,900.
Meanwhile, the total number of overseas trips made by Irish residents during October increased 6.2pc to 716,300.
“We are coming to the end of what has been the best year ever for the Irish tourism industry,” Mr Kelly said.
“This year the sector has again made another significant increase in its contribution to the Irish economy, and I’m delighted to see such stellar growth continuing into October.”
He added that feedback from the industry is that October has been a “particularly strong month” in terms of performance. TIFFANY & Co fell the most in almost four years after revitalisation efforts hit a snag in the third quarter. The luxury jeweller reported lower spending by tourists, sapping momentum ahead of the critical holiday period. Third-quarter same-store sales rose 3pc on a constant currency basis, short of estimates of 5.6pc.
luxury jeweller hit by slump in sales to tourists
Tiffany and Co on the corner of 57th Street and 5th Avenue in Manhattan, New York