Retail NZ’s latest survey reveals that 43 per cent of retailers are uncertain about their future, a notable increase from the previous quarter’s 32 per cent. Adding to the gloom, more than 70 per cent of retailers did not achieve their sales targets in the recent quarter, underscoring deepening pessimism in the sector.
Carolyn Young, CEO of Retail NZ, highlighted that these survey results were collected before the Reserve Bank’s recent shift in stance on the official cash rate, potentially signalling a shift in sentiment in future surveys. She expressed cautious optimism that the worst may have passed and that economic improvements, coupled with greater consumer confidence, could pave the way for recovery.
Young pointed to upcoming government tax cuts and recent reductions in mortgage rates by banks as potential factors that could bolster consumer confidence and spending. These measures, she believes, could inject more money into the economy and provide much-needed relief to retailers grappling with challenging trading conditions.
Despite these potential positives, challenges remain, particularly regarding merchant service fees for contactless payments. Young acknowledged retailers’ concerns about these fees and emphasised the need for fair and balanced policies from regulatory bodies like the Commerce Commission.
She noted that while free transactions may be a thing of the past due to the evolution of payment systems, finding an appropriate fee structure is crucial to support ongoing development and fairness in the industry.
Looking forward, Retail NZ aims to work closely with its members to navigate these uncertain times and advocate for policies that support a sustainable retail environment. The organisation plans to actively participate in consultations with regulatory bodies to ensure that the concerns and needs of retailers are heard and addressed effectively.
Overall, while challenges persist in the retail sector, Young remains cautiously hopeful about the industry’s resilience and potential for recovery. With supportive economic measures and consumer-friendly policies, she believes there is scope for a rebound in consumer spending and a brighter outlook for retail businesses in the coming months.
As New Zealand’s retail landscape continues to evolve amidst economic uncertainties, proactive strategies and collaborative efforts will be crucial in helping the sector adapt and thrive in the face of ongoing challenges. With some luck, such a devastating crash in the retail sector may never happen.
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