Canadian retail sales began 2021 on an uneven note

Ed Strapagiel's latest analysis shows a wide variance between categories, as well as recovery trends from the end of last year.

While some retail categories seemed to be on a recovery trajectory toward the end of 2020, Ed Strapagiel’s analysis of the latest StatsCan figures shows that some of the good fortune was not here to stay.

The biggest bright spot continues to be the Food and Drug sector, which is continuing a historic run of growth. Retail sales at supermarkets and other grocery stores continue to be strong, increasing 13.4% for the three months ending in January and 14.2% in January alone. Specialty food stores are growing at an even faster rate, up 14.7% for the quarter and 21.6% in January. Health and personal care stores are strong, up 5.8% in January.

Elsewhere, things are a bit more varied, especially in the Store Merchandise sector. A number of categories continue to be in free-fall, including clothing (down 42.1%), shoes (down 42.25), jewellery (down 32.1%) and sporting goods (19.4%). Some categories that managed to show signs of life at the end of 2020 have cooled off: while furniture and decor sales grew by 7% in the previous three months, they were down by 8.4% in January. Though still in the positive, electronics and appliance retailers had a 2.4% increase in January, compared to 12.3% in the prior three months.

Other parts of the sector have been much more stable: general merchandise stores had a sales growth of 5.2%, with building material and garden stores continuing to boom at 21.5% growth.

Outside of shifting demand, Strapagiel theorizes that the size of retailers in each segment may have something to do with the wide variance across categories: the fashion categories are made up of more small retailers, which may not have the same resources to invest into ecommerce and delivery.

After a small recovery at the end of 2020, the automotive sector has also dropped off again. Sales at car dealerships were down 10.4% in January, with gas sales down 18.3%. One bright spot, however, continues to be other automotive dealers, which covers recreational vehicles and was up 18.1%.

Looking just at ecommerce, sales are, predictably, still strong, and were up 83.6% year-over-year for the three months ending in January.