As expected retail sales were strong in March, despite the rapid spread of lockdowns designed to slow the COVID-19 pandemic but they ended up stronger than the first estimate issued a couple of weeks ago by the Australian Bureau of Statistics.
The ABS retail sales report for March showed a jump of 8.5%, better than the first estimate of 8.2%, and by far the strongest monthly jump on record.
It was driven consumers stockpiling food, alcohol, and office supplies in anticipation of coronavirus lockdown measures – as the sales update from JB Hi-Fi showed yesterday.
Seasonally adjusted retail spending rose to $30.11 billion and followed a rise of 0.6% in February (revised up from the first reported rise of 0.5%).
The ABS said that in seasonally adjusted terms, there were rises in NSW (8.0%), Victoria (7.7%), Queensland (8.8%), WA (9.9%), South Australia (9.4%), Tasmania (8.9%), the Australian Capital Territory (9.5%), and the Northern Territory (11.6%).
The result helped retail sales volumes lift 0.7% for the March quarter to a total of $80.72 billion which will boost GDP nicely (but sort of meaninglessly) for the three months to March.
The result was driven by unprecedented demand in food retailing, with spending on groceries, liquor and specialised food up between 23% and 30%.
Spending on household goods also rose sharply, led by increases in hardware, building and garden supplies (17.4%), and electrical and electronic goods (11.3%).
However, the social distancing regulations – introduced in the late March – saw sales fall in cafes, restaurants and takeaway food services (down 22.9%), while discretionary spending on clothing, footwear and in department stores was also weak.
Spending on clothing slid by a quarter in March, while spending at department stores fell 8.9%.
The ABS said March “saw both the strongest rise in food retailing, and the strongest fall in cafes, restaurants and takeaway food services, that we have seen in the history of the series.”
Online retail contributed 7.1% to the total retail turnover in March, up from 5.7% a year earlier.
Numerous retailers from Premier Investments to Myer, Mosaic Brands, Kathmandu and Adairs have noted strong rises in online sales even though their outlets were shut or restricted.
Coles and Woolies have had to employ more drivers and obtain more trucks to service the rapid rise in online orders. At one stage they were rationing deliveries.
