Christmas period boosts domestic card spending

Spending on groceries, furniture, and electronics boosted December 2020 sales compared with December 2019, but accommodation and fuel spending was low, Stats NZ said today.

Total retail card spending rose 3.5 percent in the December 2020 month, up $250 million, compared with December 2019.

For the December 2020 quarter, actual retail card spending using electronic cards was $20 billion, up $816 million (4.3 percent) compared with the December 2019 quarter.

Lift in retail spending

Retail spending rose in 4 of the 6 industries in December 2020 compared with December 2019, with higher sales of groceries and liquor (consumables) and long-lasting goods such as furniture, hardware, and appliances (durables).

In actual terms, spending on groceries and liquor (consumables) had the largest retail industry rise, up $188 million (7.5 percent) from December 2019.

“The continued spending on groceries and liquor coincides with the first month of the summer holidays,” retail statistics manager Craig Liken said.

Spending on long-lasting goods (durables) had the next largest retail industry rise, up $145 million (6.7 percent) from December 2019. This industry includes furniture, electrical, hardware, department stores, and sports goods.

“The boost in furniture and electrical goods such as cell phones and laptops reflects Kiwis spending on Christmas gifts and during Boxing Day sales,” Mr Liken said.

Despite a significant lull in April and May due to lockdown restrictions, annual card spending on durables was up $841 million (5.0 percent) compared with 2019.

Accommodation down, wining and dining up

Spending on hotels, motels, and other accommodation was down $83 million (32 percent) compared with December 2019.

“Low spending on accommodation coincides with the lack of international tourists because of COVID-19 travel restrictions,” Mr Liken said.

In contrast, spending on eating out (food and beverage services) was up $17 million (1.8 percent) compared with the same time last year.

“Kiwis unable to travel internationally during the summer holidays has resulted in domestic tourism and has seen the lift in spending on eating out,” Mr Liken said.

Fuel spending remains low

Fuel industry spending was down $74 million (12 percent) compared with December 2019.

“Fuel spending has been low since the lockdown in April compared with the same time last year, mainly due to lower fuel prices,” Mr Liken said.

Non-retail (excluding services) was down $110 million (6.3 percent) – this category includes travel and tour arrangement services (which were heavily affected by international border restrictions), rental and hiring services, and gambling.

Annual spending similar to 2019

Total annual retail card spending for the 2020 calendar year was $68 billion. This is down 0.2 percent ($154 million) from 2019.

Consumables made up 41 percent of spending in 2020 compared with 37 percent in 2019. Hospitality spending was 16 percent of the total in 2020, compared with 19 percent in 2019.

“While total spending is similar to 2019, spending patterns have changed, with less spending on hospitality and fuel, and more on groceries, furniture, and electronics,” Mr Liken said.

“Spending on groceries, furniture, and electrical and hardware goods drove the overall increase in December 2020 quarter spending.”