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| Note to Reader: Statistics Canada has changed their categorization of retail sales data; this change has been incorporated into the National Retail Bulletin moving forward. All comparable data points have been updated to reflect the changes. Specifically, the following categories have been reorganized:
The Canadian Consumer Expenditures graph is now indexed to 2004, previously indexed to 2003. |
The good news is that unadjusted retail sales were up on a year-over-year basis for the sixth consecutive month. On the other hand, the vigorous growth of early 2010 seems to be losing steam.
Unadjusted All Stores Less Automotive sales were up by 1.4% in May. This modest growth signals a decelerating trend that began in April when sales were up by 4.5% after a very impressive 6.6% increase in March.
Furniture and Home Furnishings Stores led all categories with a 5.6% increase in sales while Clothing and Accessories Stores posted a year-over-year increase in sales of 5.5%. Warm weather and weak 2009 comparables are likely to have triggered this growth. However, these categories are respectively up 6.7% and 6.1% year-to-date, so May was by no means a banner month for furniture or clothing retailers.
Please note:
The J.C. Williams Group National Retail Bulletin compares the latest monthly release of “raw” (i.e., unadjusted for seasonality) retail sales figures to those in the same calendar month of the previous year. Statistics Canada also reports seasonally adjusted sales that are compared to the previous month within the current calendar year to measure change in Gross Domestic Product (GDP). Although other sources use seasonally adjusted figures, J.C. Williams Group believes that using raw figures and making comparisons to the previous year’s performance more accurately reflects the seasonality of the retail industry and, therefore, are more useful in analysis.
General Merchandise Stores and Health and Personal Care Stores continued their steady growth in May posting moderate increases in sales of 3.7% and 3.3% respectively.
Building Material and Garden Equipment Stores reported an unimpressive 1.2% increase in sales for May. This category has enjoyed a very good 2010 after a dismal 2009. Year-to-date sales for Building Material and Garden Equipment Stores have grown 10% against 2009 sales. However, sales for May 2010 ($2.93 billion) are below May 2008 ($2.99 billion) and May 2007 ($2.97 billion) comparables.
Despite the Canadian release of the iPad in late May, Electronics and Appliance Stores posted a decrease in sales of -1.1%. Also in negative territory, Sporting Goods, Hobby, Music and Book Stores saw their sales decline by -2.2%
On the regional front, the impressive growth of early 2010 has begun to moderate. However, every region remains comfortably in positive territory year-to-date. Leading the charge is British Columbia with a year-to-date growth of 8.1%, followed by Québec at 7.2% and Atlantic Canada at 6.9%. Posting more moderate growth results are Ontario (5.7%), Alberta (5.2%) and the Prairies (5.0%).
Canadian Consumer Confidence has seesawed every month this year. Continuing this trend, the index stood at 89.3 in May (up 4.5 points from April), and at 83.6 in June (down 5.7 points from May). This trend reflects consumers’ uneasiness with an unclear economic outlook and conflicting reports on what the future might hold for us.
May was not a great month for Canadian retailers, but it may be a harbinger for things to come. The erratic and somewhat schizophrenic nature of today’s economic environment will continue to be reflected in both consumer behaviour and retail sales. This is the new normal.
Release Date of the Next National Retail Bulletin: August 24, 2010
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For more information, please contact John Archer or Maureen Atkinson (416) 921-4181 or e-mail or info@jcwg.com; Website: www.jcwg.com
Please note:
The J.C. Williams Group National Retail Bulletin compares the latest monthly release of “raw” (i.e., unadjusted for seasonality) retail sales figures to those in the same calendar month of the previous year. Statistics Canada also reports seasonally adjusted sales that are compared to the previous month within the current calendar year to measure change in Gross Domestic Product (GDP). Although other sources use seasonally adjusted figures, J.C. Williams Group believes that using raw figures and making comparisons to the previous year’s performance more accurately reflects the seasonality of the retail industry and, therefore, are more useful in analysis.
