30% Australian retail executives say trading conditions 'good': KPMG

Finances in the average household went backwards all year in 2023, to the point where savings are now at near 16-year lows of just 1.1 per cent.

The changes in shopper spending appear to have had the most impact on small and medium enterprises (SMEs), with 41 per cent of SME retailers performing below or far below their fiscal 2022-23 (FY23) forecasts and two-thirds of SMBs lacking business confidence and concerned or uncertain about the year ahead, per the Australian Retailers Association (ARA).

In its December 2023 Retail Health Index report, KPMG predicted that the retail sector would return to positive territory as early as Christmas 2024, driven by net population growth, slowing interest-rate hikes, and the wealth effect of higher property prices.

The retail playing field also underwent major changes in 2023, with multiple acquisitions and mergers.

The Australian Retail Outlook found that only 19 per cent of retailers nominated artificial intelligence (AI) as a big driver of growth this year. The opportunity for early movers to leverage AI and get ahead of their competitors is clear, KPMG said in a note.

What has been a big advancement, however, is that 67 per cent of Australians are now demanding that brands go beyond being sustainable and take responsibility for reversing the damage to the environment.

In practical terms, this translates into the three R’s: repair, reuse and repurpose—strategies that innovative fashion retailers have already adopted, KPMG added.

Fibre2Fashion News Desk (DS)