Rising Canadian retail sales create opportunities for local businesses

Statistics Canada reports that retail sales increased by 24% in June 2020 with the total retail sales coming to a dollar amount of approximately $53 billion. This comes after three months of unseasonably low sales due to the COVID-19 pandemic. After the sharp dip in sales, this was followed by an increase in all subsectors, primarily in motor vehicles, and clothing / clothing accessories stores, with June’s overall retail sales equaling out at 1.3% higher than pre-pandemic February levels.

This provides an opportunity for local businesses that have been disadvantaged due to the current pandemic circumstances to rebound their retail sales levels. Statistics Canada shows that sales are up in every province, and they are projected to continue to rise. This also provides an opportunity for the newspaper industry to regain its momentum after COVID-19 with an increase in advertising given the strength of the retail category for community and daily newspapers.

Despite the overall growth in retail sales, Statistics Canada finds that approximately 9% of brick-and-mortar retail stores were closed during June. In its place, e-commerce has been thriving as it provides the opportunity to shop from the safety of one’s own home. “This may cool off somewhat once pandemic conditions subside, but it’s unlikely that all of it will return to bricks and mortar shopping,” Ed Strapagiel, an industry expert on retail predicts.

Data from Fusion Analytics shows that Canadians are slowly returning to their pre-pandemic daily activities, with in-store shopping levels in certain areas rebounding to normal levels in early-mid July 2020. In August 2020, 80% of respondents are shopping in grocery stores, 74% shopping in other retail stores, and 56% meeting with family and friends. The two activities that continue to show low activity are for frequenting gyms and community centres, and eating out at restaurants, their percentages at 8% and 29% respectively.

As more regions reopen, widespread growth is shown in the motor vehicle and parts dealers subsector, with a 53% increase in retail sales. This was accompanied by a 12% rise in sales in health and personal care stores, 9% in general merchandise stores, 4% in electronics and appliance stores, and 2% in food beverage stores. On a whole, there is also a strong rise in sales at non-essential retail stores, with a 142% increase in June for clothing / clothing accessories stores and 71% increase in furniture and home furnishing stores. To see the data from Statistics Canada, click here. To read more about Ed Strapagiel’s predictions and analysis, click here.

Publishers can help their local markets rebound by participating in Advertise Local, a turn-key local market support program developed by News Media Canada. Click here for more information on how to support your local economy.