Australian retail sales rose 4.0% in December 2024, with some notable outliers across segments. Electronics was up 11%, furniture up 8% and pharmacy up 7%. On the other hand, department stores, supermarkets, liquor and recreational goods were all very soft. Some of the shifts reflect the baseline with December compound annual growth rates actually slower than November for all categories other than hardware and liquor.

What we’re seeing and hearing in retail

• Divergent sales trends: Feedback on retail highlights more sector and company variation than usual, that partly reflects the baseline and also promotional activity. We expect divergence to continue in 2025.
• What might reporting season might tell us: Upcoming retailer results are likely to show that even though sales trends are better, for many cost growth is higher with some downward pressure on gross margins.
• Contextualising 2024 growth: Calendar 2024 growth was 2.8%, well below the long-term trend of 5.0%. The final quarter of the year was strong at 4.0% growth, with a significant rebound in non-food sales.

Sub-sector insights

• Supermarkets: Supermarket sales grew 1.9%, a slowing from growth in November of 3.7%. Distribution centre strikes at Woolworths may have dragged sales by 0.8.%. Dining out and fresh food specialists did well.
• Liquor: Liquor was the only category to drop, down 1.7%. Endeavour Retail’s strike may have been as much as 1% drag on sales. Per capita volume declines were still meaningful, down 5% in the December quarter.
• Takeaway food and restaurant: Takeaway food sales grew 3.3% and café and restaurants were up 5.6%. This was helped by December weather, which was significantly warmer than last year.
• Pharmacy & cosmetics: Pharmacy & cosmetic sales increased 7.3%. Price remains a tailwind and Chemist Warehouse had a solid December.
• Electronics: Electronics was a standout with growth of 10.9% in December, up from 3.4% growth in November. The strength may be a backlog of orders recorded in December. Our feedback is that Harvey Norman had a stronger improvement in growth, but JB Hi-Fi remains the winner.
• Hardware and furniture: Hardware sales grew 4.1% and furniture sales were strong, up 7.2%. Furniture is partly the base line. Hardware likely benefited from drier, warmer weather.
• Recreational goods: Recreational sales were up 1.5%, positive but a slowing on the 5% in November. We have had stronger feedback on camping, outdoor and fishing, but weaker growth in sporting goods.
• Department stores: Department store sales only rose 0.8%. We have had feedback that discount department stores had a softer month including Kmart. December sales softness comes on top of weakness in November.
• Fashion: Clothing sales rose 3.2% and footwear was up 2.4%. Both segments slowed slightly on November, which suggests a pull forward into Black Friday promotions.
• Online retail: Online retail rose 14%. The shift of Cyber Monday into December boosted sales. Across the two months, non-food was up 12%.

Australian retail sales trends over time

Source: ABS, MST Marquee