Internet sales have huge advantage

Clothing sales in July were down 7.53% on July 2010, prompting retailers to call for government action.
Clothing sales in July were down 7.53% on July 2010, prompting retailers to call for government action.

SALES of essential items such as food and groceries continue to support the retail sector as spending on discretionary items collapses, according to the latest retail trade figures.

National Retail Association executive director Gary Black said the figures once again highlighted the difficult conditions confronting retailers across Australia, and the need for urgent government action on tax and workplace flexibility issues.

"Spending on clothing, footwear and personal items has fallen by more than seven per cent in the year to July," Mr Black said.

"These are areas which are particularly hard hit by the unfair advantage available to overseas-based internet businesses, who can sell their goods in Australia without facing the tax and import duties paid by local retailers.

"The Federal Government simply needs to close this loophole so Australian businesses can compete on a level playing field with their overseas counterparts.

"This continuing loss of profitability also highlights the need for more flexible working arrangements, with employers and their staff able to negotiate productivity and efficiency agreements that suit their individual needs, rather than having a one-size-fits-all model imposed on them by government.

"We also encourage the Reserve Bank to look at these figures and cut interest rates in order to stimulate consumer spending and support jobs in the retail sector."

On a state-by-state basis, all states except Western Australia continue to be very weak.

"This is the worst growth figure for Victoria in 18 months, while Tasmanian has been in a retail recession for almost two years and NSW is also struggling.

"The exception is WA, where exceptional growth has been recorded for the third straight month."

Topics:  business retail industry

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