IBEC - Newsroom

Retail Ireland, the IBEC group that represents the Irish retail sector, today published the results of a survey of member companies conducted in the first, second and third quarters of 2009.

The survey report is an analysis of business sentiment in the retail sector for the period September-November 2009 with trend analysis for the previous two quarters and is based on responses from 99 retailers. The survey excludes Christmas trading expectations.

Key Findings:

• Two thirds of respondents (66%) rate their own business currently as poor or very poor, unchanged since earlier in the year.
• Some 69% of respondents rate the prospects for their business to end November as poor or very poor, in line with sentiment in the second quarter when three-quarters (74%) of respondent companies also rated their own business as either poor or very poor for the period May to August.
• Almost two thirds (62%) of retailers expect sales to decrease to end November, one fifth (19%) expect sales to stay the same and one fifth (19%) expect sales to increase. This is a slight improvement on earlier in the year.

Commenting on the survey results, Retail Ireland Director Torlach Denihan said: "The results of the Retail Ireland survey show the difficult trading conditions facing retailers due to weak consumer demand, cross-border shopping and an uncompetitive cost base.

"Despite deep price cuts by retailers, the sales outlook is still poor. Decisive action is needed to help sustain the 250,000 jobs in the retail sector. Elected members of local authorities must vote to cut commercial rates by 20% when striking the annual rate on valuation in the coming weeks. Government must move to:

• Reduce the excise levels on alcohol, as alcohol is the single biggest motivation for cross-border shopping trips;
• Reduce VAT substantially to stimulate retail sales;
• Reduce State-controlled costs on the retail sector, such waste disposal charges, electricity prices and compliance costs."

Other Findings:

Customer numbers
Expectations on the numbers of customers have lowered slightly for the period to end November with fewer respondents (39%) expecting more customers and more (42%) predicting static customer numbers by comparison with previous quarters.

Expectations on Prices
Over half of respondents (54%) anticipate falls in prices to end November but a significant number (19%) are unsure as to future price movements.

Employee Numbers
Over half of respondents (54%) expect employee numbers to decrease and almost none (4%) anticipate an increase in employee numbers.

Redundancies
Close to one third (31%) of respondents expect to implement compulsory redundancies and 15% expect to implement voluntary redundancies by end November.

Recruitment
Over three quarters (77%) of respondents expect a recruitment freeze in their companies to end November.

Availability of Working Capital
Almost one third (31%) of respondents said the availability of working capital has decreased over the three months from May to August. This question was not applicable to a significant number (31%) of respondents.