All Irish retailers, excluding the motor industry are struggling this christmas. In November just past, retail sales increased by 0.9% in volume compared to last year. The volumes of good sold in November, excluding cars, has also dropped by 0.2% from October. Possible reasons for the drop in sales may be as a result of our current economic situation. People are afraid to spend their money since the Government has posed a mass of uncertainty through the loan negotiations with the European Union, many or saving whatever money they have for a probable bleak future. Having the value of core retail sales fall by 1.9% compared to previous years and 0.4% from October is a definite cause for concern. According to Laura Slattery of the Irish Times, this is an indication that retailers are constantly cutting prices in to convince the consumers to buy.
REI, Retail Excellence Ireland, announced this morning that December sales are on track to being the weakest in trading history. They are predicting volumes to drop by 6.7 compared to last December. This is due to a combination of both the extreme weather conditions and peoples attitudes to spending money. In the past few weeks we've all been aware of the weather change, in the begining the snow was such a novelty but now it has got to a stage where i think many people are sick of being stranded in their homes. Travelling in from anywhere outside the city is very dangerous, the council is providing sand and gravel for main roads but all country roads are skating rinks so many consumers have been unable to travel to the shops.
The bar sales are being hit the most according to the CSO. There figures show Novemeber's value of sales dropping by 13.4%. What i found unusual was that there was a 4.6% drop in sales in November compared to October. Normally one would think coming up to Xmas sales would increase because people tend to go out more with work parties or other events.
A worrying thought according to economist Alan McQuaid, "The bottom line is that it is now likely to be 2012 before we see a positive average annual change in consumer expenditure, which is bad news for the retail sector."
I think it is true. Reasons for the drop in retail sales is a result of Irish Government budget dated on 7 December 2010 consequently of Irish current economic situation.
ReplyDeleteIn this moment, winter look can explain irish retail sales decrease. However, in long term , retail sectors should now know that consumers are cautiously to spend as result of Government 7 December 2010 Budget.