ABS data released Friday confirmed that Queensland’s retail trade sector remained relatively weak in the lead up to the Christmas period, with nominal retail turnover only increasing slightly by o.1 per cent in November (see chart below).
Recent weak results in nominal turnover mean that it’s unlikely that the recent decline in real retail turnover (i.e. after removing the impact of inflation) will be dramatically reversed in the near future. As Pete Faulkner has noted at his Conus blog, retail turnover has been falling in real terms in Queensland (see chart below).
We still don’t have official data on December sales, but I doubt December sales would do much to turn this around (particularly when you consider the figures in the chart above are seasonally adjusted). Ultimately, population and economic growth should push real retail turnover back upwards, but the shift to online sales will no doubt continue to have an adverse impact on real retail turnover recorded in Queensland.
NSW and Victoria don’t appear to have been as adversely affected by the growth of online retailing as Queensland (see chart below). This is possibly because the distribution centres (a.k.a. fulfilment centres) for Australian retailers with an online presence (e.g. David Jones, Myer) are typically located in Sydney or Melbourne. While international online sales aren’t recorded by the ABS, domestic online sales are, and I suspect the ABS is recording these sales as occurring in the State where the relevant fulfilment centre is, which makes sense because that is where the jobs will be located. If this is the case, then online sales for David Jones and Myer, for example, improve retail turnover in NSW and Victoria, but not for Queensland (any may actually subtract from turnover in Queensland if these goods would otherwise have been purchased in a bricks-and-mortar store in Queensland).
As ABS experimental estimates reported in its latest retail trade publication show, domestic online sales in Australia are becoming increasingly important, having grown from $417 million in the month of March 2013 to $745 million in the month of November 2014.