Retailers must adapt to the changing retail environment.
With the release of the CSO retail sales figures for January today (3rd March), ISME, the Irish Small and Medium Enterprises Association reiterates its concern with the low margins currently being recorded for the retail sector. The Association calls on retailers to have a greater online presence to maximise sales.
The annual Retail sales figures for January show an increase of 4.9% in Volume and 2.6% in Value. When motor sales are excluded there was an increase of 6.1% in Volume and 3.3% in Value in the year. The monthly figures show an increase of 2.2% in Volume, and 2.9% in Value.
ISME, CEO, Neil McDonnell said, “2017 is presenting challenges for retailers, with many consumers taking advantage of the drop in sterling. To mitigate this, we urge retailers to have a greater online presence. According to Visa’s Irish Consumer Spending Index, e-commerce spending increased annually by +15.4% in December, while Face-to-Face spending decreased by 0.3%”
The main issues facing retailers are:
Very low margins, as evidenced by the CSO figures.
Negative cross border trade and currency fluctuations.
Lack of online presence
Excessive business costs such as insurance, rates, and development charges.
“The nature of consumer spending is changing and retailers must adapt to this in order to maximise their profit margins. It’s no longer enough for a business to have a website. Successful businesses must be able to trade through their website”