November sales reveal challenge for retailers under third lockdown
RETAIL sales plunged in November, during the only full month of the second lockdown, foreshadowing a severe impact from even tougher pandemic restrictions introduced this month.
According to new data from the Central Statistics Office (CSO), retail sales volumes fell 12.8pc month-on-month in November after several months of recovery. In value terms, the drop was even steeper at 13.7pc.
It was the biggest fall in retail sales since April, when most businesses were forced to close in the early weeks of the Covid-19 pandemic.
Now after post-Christmas sales were restricted due to rising case numbers, retailers are facing an uncertain period with most activity banned for an indefinite period.
“It feels like we’re in for a much longer lockdown,” said Duncan Graham, CEO of Retail Excellence Ireland, a representative body for more than 2,000 retailers. “What’s concerning is this time we can’t plan for it as we did in October. Christmas cash will allow retailers to get through February, but after that we just don’t know.”
Mr Graham said the impact of poor November sales was not as bad for his members as the first lockdown in the second quarter because many consumers did their Christmas shopping in October.
Consumers ramped up spending in the five days before Taoiseach Micheál Martin’s speech on October 19 announcing nationwide Level 5 restrictions, according to card spending data produced by the Central Bank.
However, he said sales after Christmas had been muted and retailers were struggling to shift winter stock.
“Retailers weren’t buying with the expectation of another lockdown exceeding six weeks,” he said.
Even though many retailers have managed to shift a lot of their business online – online sales in November hit 12.3pc – the ban on click-and-collect was another headwind.
“The CSO Retail Index for November demonstrates the fluctuating environment that Irish retailers are operating in,” said Owen Clifford, head of retail sector business for Bank of Ireland. “The statistics demonstrate the importance of having an online offering for consumers to complement the physical store.”