Australian small retailers are hoping for a prosperous end to the year with the majority (73%) saying this festive trading period will be ‘extremely important’ (42%) or ‘very important’ (31%) to their business, according to the Australian Retailers Association (ARA) and American Express Small Retail Index.
The Index shows almost half (44%) of small retailers are forecasting sales to be ‘slightly up’ or ‘significantly up’ on last year’s figures, while 31% say they expect sales to be flat compared to last year.
The introduction of new products and services will be a primary focus for 35% of small retailers. Most surveyed (57%) are expecting more customers to prioritise sales and discounts this festive season, with 28% saying they will offer more promotions to meet this demand.
Almost three quarters (73%) of small retailers are trying something new this year to entice customers, with only 27% following the same approach as in previous years.
Black Friday and Cyber Monday will play a key role for small retailers, with 26% of small retailers taking part in these upcoming sales events. Of those participating, 84% have engaged in these promotions previously, while an additional 26% are participating for the first time.
Many are feeling positive about the future, with 41% of small retailers saying they feel ‘somewhat’ (34%) or ‘very’ (7%) optimistic about trading conditions in 2025, while 31% say they feel neutral.
ARA chief industry affairs officer, Fleur Brown says there is eager anticipation among retailers as they race to the end of year finish line.
“This peak season trading period is more essential for retailers than ever, offering many discretionary retailers the chance to make up to two-thirds of their annual profits. We are predicting a $69.7 billion boost in the lead up to Christmas, with $6.7 billion spent over the Black Friday Cyber Monday period alone,” she said.
“Australians are stocking up on gifts early, with many shoppers choosing to tick off their Christmas lists by the end of this month. While customers are being savvy with their dollars in certain areas, they also are showing increased spending across food and discretionary categories which includes sporting and recreational goods.”
American Express vice president of global merchant services, Robert Tedesco believes many small businesses will be pulling out all the stops this festive season.
“Small businesses are the heart of our retail sector and we know that many Australians will be shopping local this year. Christmas is the perfect opportunity for small businesses to engage with their local communities and to make the most of the consumer appetite for gifts and in-store experiences,” he said.
“It’s encouraging to hear that many small businesses are employing new ways to engage customers and that their outlook is optimistic for the Christmas trading period.”