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Retail growth to slow in lead up to Christmas

Retail-Trade-Turnover-Edition-19-e1445917352800Retail trade growth may slow in the lead up to Christmas, according to the AFGC CHEP Retail Index.

Year on year retail trade growth is expected to soften to 3.6 per cent in the December quarter from 4.2 per cent in the September quarter.

On a monthly basis, the Index was 4.4 per cent higher in September 2015 compared with September 2014, with retail trade turnover of $24.5 billion.

Growth is expected to slow to 3.6 per cent year on year in the month of November with turnover of $24.6 billion.

The AFGC CHEP Retail Index is a collaborative project between the Australian Food and Grocery Council (AFGC) and CHEP Australia, powered by Deloitte.

The Index uses CHEP transactional data based on pallet movements and is a lead indicator of Australian Bureau of Statistics Retail Trade Data.

“Weaker food price inflation domestically can be attributed to a range of factors including below average income growth over the past three years and a slowing in population growth,” said Australian Food and Grocery Council CEO, Gary Dawson.

The sales result for retailers over the year to August 2015, as reported by the Australian Bureau of Statistics (ABS), was weaker than the forecast in the previous AFGC CHEP Retail Index. The growth of 4.3 per cent over the year to August 2015 compares to the prediction of 4.7 per cent growth.

The latest ABS trend data also indicated that household goods retailing has been the strongest performing sector with a big lift in new home building and low interest rates encouraging higher levels of spending on consumer durables. Sales growth for other discretionary retailing categories including clothing sales and department stores also strengthened in the first half of this year.

“In these times of challenge for domestic retailers CHEP is committed to support the industry with standardised and unitised solutions that unlock untapped efficiencies in the supply chain,” said Phillip Austin, president of CHEP Asia Pacific.

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