February, a trend or an aberration?

While February retail performance was a welcome change by retailers on last year, seeing YOY growth at 3.6%, the highest we have had since September, the question beckons... is this a trend of better times to come or an aberration?

February was indeed a bumper month for food (5.5%) and liquor (8%), while apparel (3.9%) finally received a reprieve with its new season launch. However the tragic Queensland floods and other natural disasters have played more than a small part in the result. Indeed, the Australian Retailers Association said February would have been far worse without many households replacing damaged goods and supplies after the floods in January.

But when we look more closely at the February results the reality is most general merchandise discretionary categories are still struggling to match their prior year performance, and are declining in retail terms. Department stores saw 0.7% growth, furniture and floor coverings stayed at about even (0.3%) while footwear (-3.8%) and electrical goods (-4.4%) both fell below baseline.

So aberration? The buoyancy of food & liquor from needs based replacement purchasing should not mask the continuingly difficult time that has become the trend for general merchandise retailers. Before real shifts in growth can be realized, we must respond to the fundamental societal shifts that are driving changes in consumer behaviour. All in all, we suspect February might just have been a pleasant surprise.

If you would like to understand your category in more detail, your relative performance, or how to better engage your consumer, RetailOasis has extensive retail experience and can assist you with future business development based on rigorous quantitative analysis and insights. Contact Steve Kulmar or Nerida Jenkins at RetailOasis on +612 9976 6222 or follow the link below to order a report.

Click here to view detailed February results.

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