Food retail sales rose by 3.8% in Ireland in the third quarter of the year, compared to the same period last year, according to the quarterly Business Monitor from Food Drink Ireland (FDI).
This is ahead of the EU average for food retail sales growth (3.1%), but behind that of the UK (4.4%).
The report found that in the month of October, Irish food retail sales were up 4.4% on the same month in the previous year. The month-on-month increase from September 2018 to October 2018 was 0.1%.
The increase in retail sales is partly explained by a decrease in food prices – food prices were down 2.5% in the third quarter of the year, and by 2.2% in October 2018, compared to the previous month.
Consumer Sentiment
In terms of consumer sentiment and its impact on retail sales, the FDI report found that 'Growth in the population, employment and wages continue[s] to have a positive impact on consumer spending. The total value of consumer spending in the economy is on course to grow by 5% in 2018, with volumes likely to grow by 3.8%.
'This is consistent with the higher frequency retail sales data which shows that sales have risen by 4% in volume terms in the first eight months of 2018. Trade was strong in Q3, this is due to the persistent gap between sales values and volumes continuing to close to a point where there is now almost like for like growth in both sales’ quantities and values. This trend suggests a return to more normal margins in the retail sector.'
Announcing the report, Paul Kelly, FDI director, highlighted the difficulties for the agri-food sector in attracting and retaining skilled workers at present.
“Despite the ongoing significant efforts to recruit from the Irish and European labour force, the critical nature of the current situation is deepening, as the economy approaches full employment again," Kelly said.
"The situation has now deteriorated to levels where it is having a real impact at individual factory level and negatively impacting the ability of companies to plan for expansion and, indeed, to meet day-to-day operational demands to service existing customers. Government must urgently extend the employment permit schemes across the food-processing sector so that labour shortages do not impact on existing business and growth prospects," he added.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
