Further gloom for retailers as sales drop $5m
Retailers suffered a further blow to a tough year’s trading during 2009 as sales fell by five $5 million or five percent in November 2009 - the ninth straight month of decline, according to the latest figures released by Government.
The Department of Statistics’ Retail<>Sales Index revealed that gross turnover was down at $88 million from $93 million for the same period last year, while after adjusting for the rate of inflation, the volume of retail sales dropped by seven percent. That level has been consistently below that of the previous year since March 2008.
Building material, liquor and apparel stores were hit the hardest, declining 13.1 percent, eight percent and 7.6 percent respectively for the month of November.
This marked the second successive month of double-digit sales decreases for the building material sector as vendors felt the full effect of the slowdown in the construction industry, with the completion of existing major contracts and a drop-off in the number of new projects coming on line.
Alex DeCouto, owner and president of Greymane Contracting, which sells drywall and related products to small contractors and for Do It Yourself (DIY), said a fall in the retail index was likely to be more indicative of reduced consumer spending on small projects and DIY work.
Mr.DeCouto said his company had experienced a very slow fourth quarter in retail sales and admitted it was hard at the moment to make projections for the future, with decisions such as keeping staff and buying inventory in this challenging business environment.
”I think generally people are cutting back during this recession,” he said.
”Of course, large projects are significantly slowing down as well so the combination is not good for the industry in general. Not at all.”
While gross receipts for food stores were relatively flat for November, the cost of items in that category rose 2.7 percent, however liquor sales fell compared to 2008.
Apparel sales continued to decline despite attempts by retailers to encourage consumer spending through longer opening hours and discounts and the launch of the Chamber of Commerce’s Bermuda Savings Book, which had little impact on sales activity.
But the motor vehicles sector enjoyed its first increase in sales for more than half a year since May 2009, climbing 2.1 percent, mainly due to higher demand for automobile models and the availability of popular bike models.Combined sales for all other store types, including furniture,
Combined sales for all other store types, including furniture,appliances, electronics and pharmaceuticals, plummeted 10 percent year-over-year, reflecting a lower revenue from furniture and appliance sales, which plunged sharply by 39 percent and 12 percent respectively.
In contrast, retail sales for pharmacies and drug stores advanced two percent.
Service stations remained relatively unchanged in<>November versus prior years, with the cost of fuel up 5.8 percent, mirroring a decline in the volume of gasoline sales during the month.
Meanwhile overseas purchases declared by returning residents dropped 8.3 percent or $7.7 million during November.