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Retail Trade Survey: May 2010
Embargoed until 10:45am  –  14 July 2010
Commentary

All references to sales movements are to seasonally adjusted series unless otherwise stated.

May 2010

The value of total retail sales rose 0.4 percent ($24 million) in May 2010, following a decrease of 0.3 percent ($18 million) in April. This month’s increase was led by the vehicle-related industries, which recorded a combined increase of 2.3 percent ($33 million).

Sales for core retailing (which excludes the four vehicle-related industries) decreased 0.2 percent ($10 million) in May 2010, led by a fall in the hospitality industries. Half of the 20 core retailing industries recorded lower sales.

Overall, the largest increases were:

  • motor vehicle retailing – up 7.5 percent ($43 million)
  • appliance retailing – up 3.9 percent ($8 million) 
  • automotive electrical, smash repair, and tyre retailing – up 6.3 percent ($7 million).

The largest decreases were:

  • automotive fuel retailing – down 1.9 percent ($11 million) 
  • accommodation – down 3.6 percent ($8 million) 
  • other retailing – down 3.0 percent ($8 million)
  • cafes and restaurants – down 2.0 percent ($7 million).

Sales trend

The core retailing trend had been gently declining since October 2009, but has flattened over the past few months. The current level of the core retailing sales trend is 0.7 percent ($29 million) lower than at its peak in October 2009.

The trend for total retail sales had been rising since a turning point in February 2009, but has flattened since November 2009. Although the current level of the trend is 3.1 percent ($167 million) higher than at the February 2009 turning point, it is still 0.4 percent ($21 million) below the record high of January 2008.

Hospitality industries

The three hospitality industries covered by the Retail Trade Survey are cafes and restaurants, accommodation, and bars and clubs.

Sales in the hospitality industries fell a combined 2.0 percent ($13 million) in the May 2010 month, with notable decreases in accommodation, and cafes and restaurants, partly offset by a small increase in bars and clubs.

Accommodation sales fell 3.6 percent ($8 million) in May 2010 – this industry's largest decrease in over a year. However, this month’s fall follows a large increase of 6.8 percent ($15 million) in the April 2010 month.

Despite this month’s decrease in seasonally adjusted sales, the accommodation trend continues to increase, and has risen 10.4 percent ($21 million) since a turning point in June 2009.

     

Sales for cafes and restaurants also fell in May 2010, down 2.0 percent ($7 million) following a 0.7 percent rise in April. The trend for cafes and restaurants has fallen steeply since a turning point in December 2009, and is down 3.7 percent ($12 million) since then.

Vehicle-related industries

The four vehicle-related industries recorded a combined increase of 2.3 percent ($33 million), offsetting this month’s fall in core retailing, to result in a slight increase for total retail sales. Because of their large size, the motor vehicle retailing and automotive fuel retailing industries often have a significant impact on total retail sales.

Motor vehicle retailing recorded the largest increase of all industries in May 2010, rising 7.5 percent ($43 million). This increase follows a flat April, and small decreases in March and February.

The trend for motor vehicle retailing has been rising for over a year, up 13.1 percent ($68 million) since a turning point in March 2009. However, the current level of the trend is still 17.1 percent ($122 million) below its historic high recorded in June 2007.

    

Automotive fuel retailing recorded the largest decrease of all industries in May 2010, falling 1.9 percent ($11 million). This is the second consecutive fall in this industry, with a drop of 2.1 percent ($12 million) in April 2010.

The trend for automotive fuel retailing was 9.6 percent higher in May 2010 than at the turning point in June 2009. However, the trend has flattened over the last few months, and is showing signs that it may be decreasing again. 

Actual sales

In actual terms, total retail sales rose 1.9 percent ($98 million) in May 2010 compared with May 2009. This increase was led by motor vehicle retailing (up 16.8 percent or $88 million) and automotive fuel retailing (up 5.8 percent or $30 million).

When the four vehicle-related industries are excluded, actual core retail sales were 0.6 percent lower in May 2010, than in May 2009. This is only the fourth time that a decrease has been recorded in core retail sales (compared with the same month of the previous year) since the series began in 1995 (previous falls occurred in February 2009, March 2008, and February 1997). To put this month’s fall in context, the long-term average change for core retailing (compared with the same month of the previous year) is an increase of 4.8 percent.

As illustrated in the graph below, this month’s decrease in core retail sales was led by:

  • recreational goods retailing – down 7.7 percent ($14 million) 
  • liquor retailing – down 11.6 percent ($12 million) 
  • cafes and restaurants – down 2.8 percent ($9 million).

Supermarket and grocery store sales have increased at an average rate of 5.8 percent (compared with the same month of the previous year) since the start of the series and, until recently, have regularly contributed the bulk of the increase in core retail sales. However, in May 2010 supermarket and grocery stores recorded its first ever decrease – down just 0.1 percent ($1 million) from May 2009.

The only core retailing industry to record an increase greater than $10 million was accommodation, which rose 8.3 percent or $14 million. 

Regional estimates

Seasonally adjusted sales in the North Island rose 0.4 percent ($16 million) in May 2010, while sales in the South Island remained the same as in April 2010.

Sales changes in the North Island were as follows:

  • Auckland – down just 0.1 percent ($1 million) 
  • Waikato – down 0.7 percent ($4 million) 
  • Wellington – up 0.4 percent ($2 million) 
  • Remainder of the North Island – up 1.5 percent ($18 million).

Sales changes in the South Island were as follows:

  • Canterbury – up 0.6 percent ($4 million)
  • Remainder of the South Island – down 0.6 percent ($4 million).

The total sales trends for both the North Island and the South Island have remained flat in recent months.

Illustrated in the graph above, the regional sales trends are as follows:

  • Auckland – the trend has risen 6.3 percent ($108 million) since a turning point in January 2009, but the rate of increase has eased recently. 
  • Waikato – the trend has risen 5.9 percent ($29 million) since a turning point in January 2009. 
  • Wellington – the trend has fallen 0.6 percent ($3 million) since a turning point in January 2010. 
  • Remainder of the North Island – the trend has fallen 0.8 percent ($10 million) since a turning point in December 2009. 
  • Canterbury – the trend appears to have reached a turning point in February 2010, and has risen 0.7 percent ($5 million) since then. 
  • Remainder of the South Island – has remained flat over the past four months following a period of increase.

Revisions

There were no revisions to the Retail Trade Survey in the May 2010 month.

Related information

For May 2010 compared with April 2010:

  • The food price index fell 0.7 percent.
  • New registrations of cars and station wagons (including vehicles previously registered overseas) increased 3.1 percent.
  • Seasonally adjusted short-term overseas visitor arrivals increased 1.0 percent.
  • As first published (on 10 June 2010), the seasonally adjusted value of the retail Electronic Card Transaction (ECT) series rose 0.4 percent, and the seasonally adjusted value of the core retail ECT series rose 1.0 percent.

Other:

  • The Reserve Bank of New Zealand's Official Cash Rate was unchanged at 2.50 percent throughout May 2010.

Measurement errors

All statistical estimates are subject to measurement errors. These include both sample errors and non-sample errors. In addition, the survey applies imputation methodologies to cope with small firms and non-response. These measurement errors should be considered when analysing the results from the survey. For more information on measurement errors, please refer to the 'Technical notes' of this release.

Sample errors

The postal survey was designed to give statistics at the following levels of accuracy (at the 95 percent confidence interval limit):

  • 2 percent for sales at the total national retail trade level
  • 10 percent for sales at the published national retail industry level.

This means, for example, that there is a 95 percent chance that the true value of total retail trade sales lies within 2 percent of the published estimate.

At the industry level, the following sample errors occurred in the May 2010 month (at the 95 percent confidence interval limit):

Retail Trade Survey: May 2010 month sample errors by industry
At the 95 percent confidence interval limit
Retail industry Level
(relative percent)
Movement
(absolute percent)
Supermarket and grocery stores 3.4 0.4
Fresh meat, fish, poultry, fruit, and vegetables 7.9 1.1
Liquor retailing 8.4 1.9
Other food retailing 9.6 2.9
Takeaway food retailing 5.4 1.8
Department stores 0.0 0.0
Furniture and floor coverings 7.7 4.3
Hardware 5.7 3.9
Appliance retailing 9.9 0.8
Recreational goods 6.5 3.3
Clothing and softgoods 5.3 2.5
Footwear 9.4 1.8
Chemist 5.9 1.6
Household equipment repair services 14.6 5.2
Other retailing 5.8 4.9
Motor vehicle retailing 9.5 4.5
Automotive fuel retailing 4.8 1.5
Automotive electrical services, smash repairing, tyre retailing 6.4 4.8
Automotive repair and services, nec 7.5 3.8
Accommodation 6.6 2.9
Bars and clubs 8.2 4.2
Cafes and restaurants 4.9 2.8
Personal and household goods hiring 11.6 10.1
Other personal services 5.7 2.4
Total retail trade 1.6 1.5
Note: nec = not elsewhere classified

 

Industries with zero sample error are full-coverage industries. In these industries, all large firms are surveyed and all small to medium-sized firms are modelled using administrative data sourced from Inland Revenue.

Retail Trade Survey: May 2010 month sample errors by region
At the 95 percent confidence interval limit
Region Level
(relative percent)
Movement
(absolute percent)
Auckland 3.5 1.0
Waikato 10.2 2.1
Wellington 5.2 1.4
Remainder of the North Island 5.6 1.2
Canterbury 6.5 2.5
Remainder of the South Island 9.0 3.4

Imputation

Small firms

Small- to medium-sized firms are generally not surveyed. Their variables are instead modelled from administrative data (GST) sourced from Inland Revenue. Ratios calculated from the postal sample units are applied to the administrative data to provide an estimate of their variables.

Non-response imputation

Although every attempt is made to achieve a 100 percent response rate, in practice this does not occur. Values for non-responding businesses are estimated by a number of methods, including:

  • regression imputation
  • historic imputation
  • mean imputation.

Regression imputation involves estimating sales from the unit's administrative data (GST sales) based on the relationship shown by similar businesses. Historic imputation involves multiplying their response in the previous period by a non-response factor. The non-response factor is the average movement of similar businesses over the month. Mean imputation involves estimating a value for a unit by using the average value for a set of similar businesses.

Postal response rate

The response rate describes the proportion of geographic units that provided survey responses. Note that the calculation of this response rate relates only to data for the postal sample. The Retail Trade Survey has a target response rate of 85 percent. The response rate achieved for the May 2010 survey was 91 percent.

The table below indicates the percentage of sales imputed in the May 2010 month:

Sales imputed in the May 2010 month
Retail industry Tax modelled Non-response
Percentage of sales
Supermarket and grocery stores 6.1 4.1
Fresh meat, fish, poultry, fruit, and vegetables 8.9 14.8
Liquor retailing 11.3 13.1
Other food retailing 10.2 11.0
Takeaway food retailing 9.3 14.2
Department stores 0.0 0.0
Furniture and floor coverings 13.8 15.8
Hardware 6.1 6.0
Appliance retailing 7.3 3.2
Recreational goods 10.6 13.9
Clothing and softgoods 9.5 5.3
Footwear 6.7 9.5
Chemist 5.3 14.4
Household equipment repair services 10.3 9.7
Other retailing 15.9 14.6
Motor vehicle retailing 11.1 9.4
Automotive fuel retailing 2.6 4.5
Automotive electrical services, smash repairing, tyre retailing 10.3 13.7
Automotive repair and services, nec 11.7 14.4
Accommodation 10.1 16.9
Bars and clubs 15.0 12.6
Cafes and restaurants 11.2 16.1
Personal and household goods hiring 12.8 11.7
Other personal services 13.7 15.7
Total retail trade 8.2 8.7
Note: nec = not elsewhere classified

 

For technical information contact:
Kate Jackett or Yannick Monteyne
Christchurch 03 964 8700
Email: info@stats.govt.nz

Next release ...

Retail Trade Survey: June 2010 quarter will be released on 13 August 2010.

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