Otago worst hit by historic sales drop

Spending on eating out, including in Dunedin, fell sharply in the June quarter. Photo: Getty Images
Spending on eating out, including in Dunedin, fell sharply in the June quarter. Photo: Getty Images
Retail sales values fell a historic 15% in the June 2020 quarter, due to the initial Covid-19 lockdown.

Otago was hardest hit in percentage terms, down 27% or $343 million.

Nationally, it was the biggest drop on record in figures going back 25 years, Stats NZ's Retail trade Survey showed.

‘‘The June quarter decline was sharper than the 12% contraction we expected,’’ Westpac senior economist Satish Ranchhod said.

But the result was ‘‘firmer than most domestic forecasters expected’’.

Most other New Zealand forecasters were expecting a fall of closer to 20%.

Spending on eating out, accommodation away from home, vehicles, and fuel all fell sharply in the June 2020 quarter compared with the June 2019 quarter, according to the survey released yesterday.

This fall was only partly offset by strong supermarket and grocery sales.

‘‘This unprecedented fall in the June quarter was not unexpected, with Covid-19 restrictions significantly limiting retail activity,’’ retail statistics manager Kathy Hicks said.

‘‘Non-essential businesses closed temporarily for about half of the quarter during Alert Levels 4 and 3.’’

Most industries experienced unprecedented sales falls in the June quarter.

Sales for food and beverage services fell 40% or $1.2 billion in the quarter, the largest drop of any industry.

‘‘For a team of 5 million, that is equal to each person spending about $18 a week less on eating out over the June quarter,’’ Hicks said.

Fuel retailing had the second-largest fall, down 35%, or $770 million.

These falls were followed by:

• Motor vehicles and parts retailing, down 22% ($729 million)

• Accommodation services, down 44% ($418 million)

• Hardware, building, and garden supplies down 16% ($350 million).

The Auckland region had the largest dollar value fall this quarter, down 13% ($1.2 billion).

Canterbury had the next-largest fall in dollar terms, down 17% ($516 million).

While the regions with higher population numbers recorded the largest dollar value falls in the June quarter, the drops in the South Island regions were more significant to their economy.

‘‘The big drop in sales for the Otago region in part reflects the significant fall in overseas tourists visiting the Queenstown-Lakes region,’’ Ms Hicks said.

Other regions affected by less international and domestic tourism spending were the West Coast, down 22% ($33 million), Southland, down 19% ($89 million), Nelson, down 18% ($51 million), and Tasman, down 18% ($42 million). 


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