Treasurer-elect Joe Hockey has declared Australian consumers should lash out and get spending, in a confidence boost for small business.
“You can go forward and spend your hearts out because we’re going to have a good Christmas,” he said, as reported by The Australian.
RetailOasis retail specialist Nerida Jenkins told SmartCompany this morning that Hockey’s comments would likely be welcomed by the retail industry, as she expected industry and consumer confidence to rise in the wake of the election.
“Retailers will breathe a collective sigh of relief as there is now more certainty, and that will play well into consumer confidence,” she says.
“Consumers have been in a mode of saving and paying down debt, but that downward pressure could be relieved by the optimistic outlook.”
Jenkins says the Australian Bureau of Statistics retail figures for July 2013 showed retail growth was only 1.9% up on the previous year, a figure below CPI which is around 2.5%.
She says the total spend for consumers in the retail sector was only 31%, down from 40% from the previous year. Consumers have been directing money towards travel, cost-of-living and entertainments.
“It is positive for everyone,” she says.
“People have been tightening their belts in the pre-election period, but now we see a loosening of belts and a positive, brighter lead up to Christmas.
“Will it be the big uptake that we hope for? It might be more modest due to the changing way that people are spending their money.
“Retailers need to cater for a more sophisticated consumer.”
Australian Retailers Association executive director Russell Zimmerman reacted positively to the Coalition’s win, along with other industry bodies, and declared that the ARA and Australian Chamber of Commerce and Industry would work together to ensure the new government delivers for retailers and small business.
“We have every hope that with the new majority Abbott government supporting retail and business, retailers and consumers alike will be able to enjoy a heightened sense of confidence and stability – resulting in a boost in sales toward the end of the year and a promising start to 2014,” he said in a statement.