Why it matters: Cost-of-living pressures are rising and retailers are cutting back their usual stock ordering in readiness for tough times in the lead-up to Christmas.
Gerry Harvey, the executive chairman of electronics retailer Harvey Norman, says stock ordering levels at the chain are at about 90 per cent of usual.
Australian Retailers Association boss Paul Zahra says retailers are being squeezed by cost-of-living pressures faced by their customers, and rising costs in their own businesses.
Retailers have substantially cut back the amount of stock they are ordering as they brace for a subdued pre-Christmas selling season, in the latest sign households are reining in their spending to cope with cost-of-living pressures and a sharp rise in mortgage repayments.
With little prospect of interest rates falling until mid-2024, retail chains are being careful to avoid being stuck with too much inventory in warehouses and stores. Gerry Harvey, the executive chairman of electricals and furniture retailer Harvey Norman, said the cost-of-living pressures were at their most intense in metropolitan stores and mortgage-belt suburbs.
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Simon Evans writes on business specialising in retail, manufacturing, beverages, mining and M&A. He is based in Adelaide. Connect with Simon on Twitter. Email Simon at simon.evans@afr.com
