A difficult winter for Whanganui retail businesses despite spending figures looking stable

Whanganui's main shopping street Victoria Ave on a quiet winter morning. Photo / Bevan Conley

A small retailer in Whanganui says the winter season has been one of the more difficult, but there is hope of optimism as the weather improves.

Recent consumer spending released by Whanganui & Partners for the year to July 2022 was $616 million - 4.8 per cent up on the same period a year earlier.

That was higher than the national consumer spending figures, the organisation's chief executive Hannah Middleton said.

"Business owners in Whanganui are facing pressure due to the labour market, the Covid pandemic and associated economic impacts.

"We encourage people to choose to shop with local businesses whenever they can and we know the Whanganui community is particularly good at supporting local business owners and takes pride in this."

Whanganui & Partners chief executive Hannah Middleton. Photo / Bevan Conley

Middleton said when looking at Infometrics data, it was clear June was "flat" and sales in the lower North Island had "eased considerably".

"We know that consumers are feeling the effects of inflation and that our local retailers will have noticed a difference in people's spending habits."

One of those local retailers is Victoria Ave shoe shop Posh Comfort.

"I won't sugar coat it," owner Jenny Monk said.

"Winter's been a difficult season ... it has been one of the more difficult seasons that we've had."

She had recently been to a shoe fair in Auckland and said similar businesses had also found winter tough.

For Monk, the downturn was probably due to there being a lot of illness around, Covid fatigue and the cost of living increasing.

"We've all been affected by that.

"And then I guess with media coverage of recessions ... people are a bit more cautious about spending."

Monk was appreciative of local support.

Posh Comfort owner Jenny Monk. Photo / NZME

"People are definitely trying to support local where they can. We find our customer base has been just fantastic in doing that."

Mitre 10 owner Hayden Gibson said while he believed Whanganui was in a positive place with a lot of development, things had slowed.

"I suppose everyone's confidence has been a bit strained lately."

He cited rising interest rates as a possible reason for the slowdown - but also that they were coming down from a very high point last year.

"The jobs that are going on with renovations and building are still far more than what they were prior to that ... last couple of years."

Gibson said a lot of builders he had spoken to were booked up with work as far as 18 months ahead.

His expectation was the next few months would be a bit of a mix with consumer spending.

"People are traveling a bit more now. [We're] looking forward to a good summer, taking our masks off and enjoying it."

Like Gibson, Monk was also optimistic about the summer.

Whanganui Chamber of Commerce chief executive Helen Garner said typically optimism came along with the better weather of spring and summer.

She said while some big box retailers might be doing alright, her impression of smaller retailers was they were not as well off.

Whanganui Chamber of Commerce chief executive Helen Garner. Photo / Bevan Conley

"We're coming off the back of winter, flu season, Covid, high inflation.

"There's a lot of factors that have been contributing to that."

Garner said hospitality businesses were an example where a change in customer behaviour made planning very difficult.

"Movement of people has become quite unpredictable.

"One day will be frantically busy and the next will be incredibly quiet.

"That's really hard to work out."

The wider economy and things like interest rates were out of businesses' control.

"We understand that.

"It doesn't make it any easier though."

While spending figures might be up, she said it was probable that trend related to things like groceries and petrol or at big box stores.

"Then a big chunk of our smaller hospitality and retail is under pressure."

Whanganui & Partners said it didn't have full figures for August spending but July was up 3.8 per cent on July 2021, while for all of New Zealand, consumer spend was up 1.8 per cent.

"Overall we can see consumer spend remains steady in Whanganui and is ahead of the national average," Middleton said.
Middleton said encouragingly there had been improvement in hospitality and accommodation spending - two sectors badly affected by the Covid pandemic.

"We expect these figures to keep improving for our restaurants, cafes, bars and accommodation providers as we enter the warmer months and start seeing more and more visitors arrive.

"We also have a very busy events season ahead of us, which always provides a boost for these businesses, along with lifting our consumer spend figures for the whole region."