Retail could reach 20-year high in 2017 » strategy

Retail could reach 20-year high in 2017

Many sectors saw significant growth up until November, but sales in ecommerce surged the most.
retail grocery carts

As of November last year, total year-to-date retail sales were up 7% compared to the year before, with the possibility of hitting a 20-year high, according to the most recent analysis of Statistics Canada data by retail analyst Ed Strapagiel.

Growth was boosted by sales in the automotive and merchandise sectors, while growth in the food and drugs category continued to slow.

Food and drug sales, which had recovered mid-year following a slower-than-usual start, began to fall again in the last months of 2017. Strapagiel notes that the sector’s biggest challenge is with supermarkets and grocery stores, where sales had grown by a scant 1% year-to-date in November. Sales grew in health and personal care stores by 6%, but that was less than half the 13.8% annual increase seen in 2016.

Sales in merchandise continued to experience strong growth, with year-to-date numbers coming in at 7% higher than those recorded the year before. Sales for the last three months were slightly higher (7.6%) indicating there was “more upward potential left.” Building material and garden equipment led the pack with growth rates of 13% and 12.5%, respectively.

The 12-month trend in the automotive category “has relentlessly increased for the last two years,” according to Strapagiel’s assessment. “But it has now caught up to the three-month trend so that retail sales increases going forward may not be quite as robust.”

New car dealers were likely to have seen an all-time high in sales last year, despite the usual slump in November. Meanwhile, gasoline sales were up 13.2% year-to-date – a significant increase, but one that fails to compare with the 22.5% growth recorded during Q1 fo 2016.

Year-to-date sales in ecommerce were up 36.6% from a year ago, which Strapagiel notes is a much higher gain compared to overall retail.