The Irish retail industry has now entered recession based on the fact the industry is experiencing a third consecutive quarter of decline with fifteen of twenty sectors recording decreases in sales revenue.
This is according to Head of Public Affairs and Communications at Retail Excellence, Lorraine Higgins who was speaking following the release of the Grant Thornton Retail Excellence first quarter 2017 Retail Productivity Review which highlights some very negative trading patterns.
Most worryingly, the Review confirms consumer activity was not as strong as it traditionally would be in most sectors of retail at that time of year.
It shows few sectors performed well, with fifteen of twenty sectors recording decreases in sales revenue. January 2017 traded down -1.79% against January 2016 which points to the continued weakness of the January sales due to significant pre-Christmas discount activity commencing with Black Friday.
March 2017 was a particularly weak month with sales erosion of -2.64% partially as a result of when Easter fell and also due to accelerated consumer sentiment erosion.
Traditionally strong performing sectors at this time of year were adversely impacted in Quarter One like Footwear (-8.83%) and Childrenswear (-10.15%). Jewellery sales fell -6.91% probably as a consequence of Irish consumers purchasing high ticket items in other markets even though such items may not be covered by insurance policies without a legitimate VAT receipt being provided.
Grocery recorded a -3.28% like for like decline in March 2017 with that of 2016 which can be attributed to Easter falling in April this year. On the other hand, the Garden sector recorded an 7.34% rise in sales and furniture and flooring was up 3.71%.
Commenting on the figures, Head of Public Affairs and Communications at Retail Excellence, Lorraine Higgins said, "Overall 2017 paints a concerning picture as we continue to trend the wrong way. With the UK facing into an election, the impact of Brexit being felt, and hyper intense competition remaining in most retail sectors, the outlook is a challenging one."
She added, "Undoubtedly, there is a real need for cost curtailment in the Irish retail industry, however with commercial rents remaining stubbornly high and in some cases rent increases being sought, the outlook is bleak. Some operators are being pushed to the edge and more retail industry failure can be expected."
Source: www.businessworld.ie
