New figures from the Australian Bureau of Statistics show that retail sales rose by 0.6% in April, including a 1.3% increase in food retailing and a 0.7% drop in the Cafes, Restaurants and Takeaway Food Services sector.

In current price trend terms, both sectors showed growth of 0.2%, an increase in the trend now for 23 consecutive months.

The Australian Retailers Association described the month’s growth as ‘dismal’, suggesting that consumers were beginning to cocoon in their homes.

“April 2010 retail sales are only up 1.8 percent compared to the same time last year. This is appalling growth and well below the current rate of inflation,” said ARA Deputy Executive Director Russell Zimmerman.

“One of the first areas of retail to be hit with a decline in sales when consumers tighten their belts is cafes, restaurants and takeaways, but it’s also one of the first areas people will start to spend in when they are loosening their purse strings.”

“Consumers were slowly beginning to treat themselves to small luxuries including a night out for dinner or a weekday lunch but April’s sales fell for Cafes, Restaurants & Takeaway Food Services (-0.7%) showing consumers are cocooning again.”

Cocooning behaviour favours Food Retailing as consumers begin cooking meals at home and stocking pantries.

“While consumers adjust to significant increases in their mortgage repayments by spending more time at home, sales in Food Retailing (groceries) have increased (1.3%). Household Goods Retailers who have been suffering all year have also had significant growth (2.6%) as consumers spend more time ‘nesting’,” said Zimmerman.

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