Retailers are welcoming an expected $69.7 billion boost in retail sales during the six-week peak season lead up to Christmas, marking a 2.7% increase on last year's figures.
This new research from Roy Morgan also reveals more Australians than ever will embrace the Black Friday/Cyber Monday sales window (29 November - 2 December) to capitalise on bargain gifts. Shoppers are set to spend a record $6.7 billion during the four days, an increase of 5.5% compared to the same time last year.
Australian Retailers Association CEO Paul Zahra says Australians want to enjoy the festive season whilst managing their household budgets.
"Shoppers are being savvier than ever with their dollars," Mr Zahra said.
"They're looking for the best value when it comes to buying presents for their loved ones, which is why sales events like Black Friday/Cyber Monday weekend are consistently growing in popularity. We are also seeing a continued trend towards spending on little luxuries whilst some broader discretionary categories are forecasted to be in decline.
"It's been an incredibly tough year for retailers and shoppers alike. Retailers are pulling out all the stops to ensure they have the best product lines and gift solutions, customer service offerings and enhanced online platforms to make shopping during this peak season more seamless than ever."
Celebrations with loved ones will feature strongly this peak season with food spending tipped to encompass the lion's share of spending. Australians are set to spend $28 billion on food, marking an increase of 4.2% on a year ago.
Discretionary (Non-food) categories will see a more modest increase of 1.6% on 2023's figures.
$5.7 billion will be spent on clothing (up 3.3%), $10.8 billion on other retailing (up 4.7%) - which includes categories such as recreational goods, books, cosmetics - and $10.6 billion on hospitality (up 4.7%).
Department stores spend is predicted to decline, with an expected spend of $3.6 billion (down 1.5%), as is spending on household goods, with a total of $10.7 billion expected (down 3.8%).
Of the biggest states, shoppers in NSW are ready to record the biggest growth in sales on last year, up 3.4%. TAS is forecasted to grow at 5.9%, QLD will see growth of 3%, VIC a 2.3% increase, and WA is preparing for marginal growth of 0.2%.
NSW shoppers are gearing up to spend $21.9 billion, while VIC shoppers are projected to be spending $17.8 billion.
Mr Zahra says this peak season trading period will be invaluable for retailers, with most discretionary retailers making up to two thirds of their annual profit during peak season.
"Whilst the year-on-year growth projections remain modest, these figures in most categories are encouraging after another challenging year. We remain hopeful of an interest rate reduction when the RBA meets in November which would have a positive impact on consumer confidence".
