Shoppers will make a last dash for the shops this weekend
It’s the final weekend before Christmas and shoppers will engage in one final spending splurge, but cost of living pressures and the new year bills could slow down some of that spending.
The nation’s army of shoppers will take full advantage of Christmas Day falling on a Monday this year – the first time in six years that has occurred – for a last-minute weekend splurge to buy presents and food, as they also try to defer angst over cost-of-living pressures and new year bills.
The Australian Retailers Association, the peak industry body representing the $400bn retail sector, believes pre-Christmas sales will hit $67.4bn, up 1 per cent, for the November-December 24 trading period, with around $9bn of that to be splurged in the final week to Christmas Day.
Food spending to cater to the family lunches and dinners many households will put on in coming days will account for the majority of that spending, making up $27bn of the overall outlay – which is up 3.2 per cent from 2022.
Given inflation in Australia is running at more than 5 per cent, it means in real terms Christmas spending will be soft or slightly weaker, with many economists and industry experts pointing to cost-of-living pressures as the key culprit in forcing many households to pull back on festive spending this year.
The sheer volumes of food being bought, however, will be huge. Woolworths chief executive Brad Banducci, who leads Australia’s largest supermarket chain, is bracing for a final burst of shopping activity between Friday and Sunday.
“We all know it’s all about those three days before Christmas and how we all work together to achieve what we need to achieve,” Mr Banducci said. “And we don’t know until we get to Christmas Day what it is. So what an amazing step up and it’s all through the basket size. So it’s these big baskets going through our business.”
Woolworths expects its sales between December 22 and December 24 to jump by more than 20 per cent, while in the week before Christmas it will send around 30 million cartons to its stores against normally 21 million to 23 million cartons in a typical week through the year.
Most economists for the nation’s leading banks believe shoppers will spend less this Christmas, search out bargains and stretch their dollars to counter rising home loan repayments, rents and utility and petrol bills. The growing popularity of the Black Friday sales in November, bringing with them steep discounts and promotions, has also dragged forward Christmas purchases from December into November.
In Sydney’s Strand Arcade, Liza Tamang from Chatswood said the cost of living has “for sure” impacted the way she shopped this year. “My room rate has increased by more than $50, so this year the Christmas shopping has been a little less than before.”
Shopping at the strand arcade on Friday, Ms Tamang said she would be staying home on Christmas Day to cook with friends.
“Just trying to get sorted before Christmas. Don’t have as many presents this year due to living abroad,’’ added Clara Duffy who was also walking through the Strand Arcade.
“I haven’t spent as much this year. It’s definitely been more selective this year. I’ve spent less this year than previous years. But that’s mostly because I’ve been travelling abroad.
“I’m not much of a Black Friday or Boxing Day shopper as I know how crazy they get, so I shop throughout the year.”
At Melbourne’s Chadstone shopping centre, the largest in the southern hemisphere, the final couple of days before Christmas will see 170,000 people walk through its doors across the Saturday and Sunday to take in 4.5 million visitors for the festive season.
Chadstone centre manager Daniel Boyle predicts gift cards will remain the last-minute go-to for the hard-to-buy-for with over 6000 sold in the week of Christmas alone, contributing to an overall 20,000 gift cards totalling $3.1m purchased in November-December.
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