New Zealand retailers anticipate sluggish winter sales

32% of businesses are uncertain about surviving in the next 12 months.

New Zealand retailers are concerned about their business prospects as they head into the winter months following a slow summer trading season.

According to the Retail NZ’s Retail Radar quarterly survey, 64% of retailers did not meet their sales targets for January-March 2024. 

Additionally, nearly a third (32%) of businesses expressed uncertainty about surviving the next 12 months, an increase from 28% in the equivalent period of 2023.

“The first months of the year are typically important for many retailers, with holidaymakers and international tourists lifting spending,” the report noted.

Moreover, more than half or 55% also do not expect meeting their sales targets in the upcoming April-June quarter.

Inflation remains the top concern for 62% of retailers, followed by rising insurance costs (55%) and wages (52%). 

“The post-election optimism recorded in the Retail Radar survey at the end of 2023 has dissipated as retailers struggle with inflation and soaring costs,” said Retail NZ Chief Executive Carolyn Young.

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She pointed out that skyrocketing insurance premiums and diminished consumer confidence are placing substantial strain on the industry.

Many retailers are experiencing significant insurance cost increases, with some considering cancelling policies due to rising expenses and falling sales.

“As we enter the traditionally slower winter months, retailers will be tightening their belts in anticipation of slow sales and uncertainty,” said Young. “Retail NZ is hoping the upcoming Budget will help restore confidence to the marketplace and provide a pathway out of recession.”