Shoppers are spending big at Myer, David Jones despite slow retail climate: report

DEPARTMENT stores have triumphed despite the nation recording its weakest annual retail growth in years, new figures reveal.

Crowds from the early hours to be first to have access to the millions of sale items at the Myers in Perth for their Stocktake Sale.

DEPARTMENT stores have triumphed despite the nation recording its weakest annual retail growth in 2.5 years.

Retail spending hit the brakes in February — new figures released by the Australian Bureau of Statistics showed sales climbed by just 3.3 per cent over the year.

That is well down on the 10-year average of 4.5 per cent and boosted only by the success of department stores including Myer and David Jones.

Crowds from the early hours to be first to have access to the millions of sale items at the Myers in Perth for their Stocktake Sale.

The Australian Retailers Association’s executive director Russell Zimmerman blamed hotter temperature patterns for the lowest year-on-year growth in spending since September 2013 which came in at just $24.8 billion.

“A combination of warmer weather patterns across most states, a pull back in spending as consumers headed back to work and school, as well as economic uncertainty have contributed to this outcome,’’ he said.

Russell Zimmerman is the executive director of the Australian Retailers Association, pictured on Bourke St in Melbourne.

But he said the nation’s largest department stores — whose sales grew by 6.6 per cent year-on-year — had worked tirelessly to try and win back customer support and have shown they are well on their way.

“Department stores have certainly been reinventing themselves, we’ve heard about how they are changing their stores and that has paid off in dividends,’’ Mr Zimmerman said.

“Department store growth in 2015 was mostly underwhelming so to see this result will be heartening for David Jones and Myer who have both placed an incredible amount of effort into reinvigorating their businesses.”

The ABS data showed shoppers continued to splash out on clothing, footwear and personal accessories — spending grew by 6.3 per cent year-on-year.

Just last month Myer chief executive Richard Umbers said the stores’ brand makeover and increased focus on customer service had helped improve their results — they recorded a rise in half-year profits of 1.8 per cent with total sales rising to $1.79 billion.

But Mr Zimmerman was not as optimistic for March retail spending which he expects to be down given the warmer weather spreading into autumn and Easter arriving earlier this year.

The Reserve Bank of Australia board meets for the third time this year today (TUES) and

St George chief economist Hans Kunnen expects the cash rate to remain at a record-low of two per cent.

“I think we will have to be quite a bit more economic softness for the Reserve Bank to cut the cash rate,’’ he said.

The cash rate has not moved since May last year.

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Originally published as Shoppers are spending big at Myer, David Jones despite slow retail climate: report