ISME, the Irish Small and Medium Enterprises Association, at the release of the CSO retail sales figures for June (28th July), raises concerns at the drop in monthly sales. The Association calls for greater Government action on the impact faced by retailers on business costs and low sales. The Association also highlights the negative impact wage increases will have on the retail sector.
Retail sales figures show a decrease of 4.8% in the month of June, although with a year-to-date increase of 4.1%. If motor trade is excluded, there was an increase of 0.8% in the volume of retail sales in June 2017 when compared with May 2017 and there was an increase of 7.1% in the annual figure. There was a decrease of 4.1% in the value of retail sales in June 2017 when compared with May 2017 and there was an annual increase of 1.6% when compared with June 2016. Excluding motor trade, there was no change in the value of retail sales compared to the previous month, and an annual increase of 3.5%.
ISME CEO Neil McDonnell said“The retail sector is in a vulnerable position at the moment. This is evidenced by our retail confidence figures, which show declines in confidence, sales, employment, investment and profitability. These declines are worrying and clearly show the volatile nature of the sector.”
“The decision by Government to accept the Low Pay Commission’s recommendation to increase the national minimum wage by 3.24% will have consequences for the retail sector. When retailers are already struggling with excessive business costs and stifling commercial rates, this extra cost will stifle the potential for employment growth.”
The main issues facing retailers are:
Very low margins, as evidenced by the CSO figures.
Negative cross border trade.
Excessive business costs such as insurance, rates, and development charges.
“Budget 2018 needs to demonstrate a pro-business agenda; failure to do so will limit jobs growth.” concluded McDonnell.