Retailers: brace for energy price fallout | IR News

Retailers: brace for energy price fallout

Retailers: brace for energy price fallout

Posted Date: 18/07/2012

By Inside Retail

Rising living costs continue to impact on Australian consumer sentiment - and survey house Nielsen warns consumers will continue to spend less in stores so they can pay rising energy bills.

Australians' purchasing intentions remain low as fears about living expenses continue to plague consumers, according to the latest figures from Nielsen, a global provider of information and insights into what consumers watch and buy.

Rising utility bills were cited as the most or second-most pressing concern by 40 per cent of Australians – a figure that has been increasing throughout 2012. The second biggest concern was job security at 14 percent, closely followed by the economy at 10 percent.

Chris Percy, MD, Nielsen Pacific, said consumers are preoccupied with factors such as deteriorating economic conditions overseas and the increasing cost of living.

"Continuing frustration over the banks not passing on interest rate cuts in full and ever-increasing utility costs is doing nothing to bolster sentiment.”

Correspondingly, almost two thirds of Australians (64 per cent) have changed their spending habits in the last 12 months to save money on living expenses. Nielsen’s findings show the most popular way to save money is via a reduction in takeaway meals, closely followed by measures to save on gas and electricity. Spending less on new clothes came in at third place.

Consumers also indicated they are opting to buy cheaper grocery brands and cutting down their spending on out-of-home entertainment to save money.

“Australians are being hit hard by the increasing cost of living, and a lack of confidence in the marketplace will only serve to further impact discretionary spending as people opt to keep their wallets firmly in their pockets,” added Percy.

Nielsen also found that almost half (47 per cent) of Australians are putting a portion of their spare cash into savings and 30 per cent allocate surplus funds to pay off debts including credit cards. However, nearly one in five Australians (19 per cent) now claim to have no spare cash after living expenses are paid.

When asked about the cost of living and whether Australians felt that now was a good time to buy the things they want or need, almost two-thirds (60 per cent) responded that now was ‘bad’ or ‘not so good’. This is in direct contrast from figures from two years ago, when 60 per cent said now was a ‘good time’ to buy things.

Compared with other countries around the world, Australia ranked 25 out of the 56 nations surveyed in terms of consumer confidence – just behind New Zealand, Israel and Pakistan.

Percy added: “This is the first time Australia has dropped below New Zealand in terms of consumer confidence in the past year. While New Zealand consumer sentiment has remained relatively stagnant in recent times, Australia has experienced a number of fluctuations including a significant drop in confidence in 2012.”

Despite this, Asia-Pacific nations come out on top overall making up seven of the 10 most optimistic countries. Indonesia, India and the Philippines recorded the highest levels of consumer confidence globally.

The European nations of Hungary, Portugal, Italy and Greece took out the bottom four spots.

Your Name:

Your Email:

Recipient Email:

Your Comments:

Word Verification:

Comments:

Wednesday, July 18, 2012 by Jennifer Ward

Well what do you expect with such an insane government raising taxes all the time a splashing the money out on 'refugees', pocket money for pensioners to throw down the pokies and a variety of boondoggles too numerous and bizarre to mention.

Leave your comment

CAPTCHA Validation

Code:

Name:
* Email:

Please note: all comments are subject to moderation for legal reasons and to prevent spam. We'll approve your comment as quickly as we can. If you don't see it appear you do not need to repost it.