Continually Falling Prices A Concern, Says Retail Ireland
Published on May 9 2017 10:08 AM
Retailers in Ireland saw an upturn in performance in the first quarter of 2017, but falling prices remains a cause for concern, according to a new report from Retail Ireland.
In its latest Retail Monitor, published today (9 May), the group said that while retail sales values grew by 3.1% in the first quarter of the year compared to the same period in 2016.
Thomas Burke, director, Retail Ireland stated: "Sales data for the first quarter appear broadly positive on the surface, however some of the other key sector metrics are a cause for concern. Consumer prices remain in free fall and profitability in the sector is now coming under real strain as Irish retailers cut prices in order to remain competitive, both with each other and with foreign based online retailers."
Q1 of 2017 showed 'significant deflation' as well has 'heavy discounting' across most categories.
The latest Retail Monitor, report also illustrated of the 32 major retail categories tracked by the CSO, 25 saw price deflation in March when compared to the same month in 2016, 'with consumer prices now back to 2009 levels'.
Burke continued, "Irish consumers continue to be strongly motivated by price and value in 2017. This downward pressure on prices is particularly worrying given recent cost increases for retailers, in rents, rates and insurance. Such increases are likely to put further pressure on the wafer thin operating margins in the sector. With consumer confidence remaining shaky, retailers are bracing themselves for difficult trading conditions over the coming months."
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