Shops performing strongly in tough market

Three years of continuous growth have seen the Bay of Plenty's retail sales rise by $26 million.

Figures released by Paymark, the company that handles 75 per cent of New Zealand's electronic transactions, show an increase of $8.5 million in spending for August compared to the same month last year.

The latest figures come on the back of a $15 million increase between August 2010 and August 2011, and a $3 million increase the year before.

This year's August increase of 3.8 per cent is below the national average of 5.5 per cent, but above some poorer-performing regions such as Gisborne, Wanganui and Wellington. It was the third highest monthly increase posted this year and the second highest in the Bay of Plenty year to date.

Paymark said stores linked to the building industry had shown the largest levels of growth, with spending in hardware stores up 9.7 per cent August-to-August.

Some Tauranga retailers reported marginal or negative growth, but others spoken to by the Bay of Plenty Times said business was picking up.

Kelly Mitchinson, owner of homeware store Home Etc, said she had noticed an increase in sales on last year - "quite a bit more" than the regional average of 3.8 per cent.

"The feeling is a lot more positive," she said.

"Perhaps their focus is maybe a bit more on quality as opposed to quantity. They're looking for luxurious stuff but still at an affordable price."

Julie Wadham, store manager at The Importer, said growth in the store's sales figures were encouraging.

Ms Wadham said people were spending more on furniture and homeware: "Property prices have gone up so there's more money to spend on furnishings. People from Auckland have beach houses here and they're coming down to set up their houses."

Bayfair Shopping Centre manager Steve Ellingford said August's sales figures had not yet been confirmed but he was optimistic higher levels of foot traffic would translate into an increase in sales.

Mr Ellingford said the more stable global economic environment, rising property market, increasing building consents and low interest rates were encouraging shoppers.

"I think people are probably feeling a bit more optimistic about the economy, security of jobs and the future in general," he said.

But Harvey Kidd, owner of Baywatch, was not convinced the growth figures heralded the end of the recession. He said his store's August sales were higher that last August, however "we can have a good month and the next month will be bad, so it's up and down".

Bill Campbell, owner of gift and souvenir shop Fancy That, said his sales were down 5 per cent since April 1.

"From discussing with other business people around the CBD, they're all saying that the retail is down, well down on last year."

Last year's August sales were buoyed by Rugby World Cup tourists and a cold snap which saw people coming in to buy possum-fur products, Mr Campbell said.

The national August year-on-year growth rate of 5.5 per cent was in part caused by high levels of growth recorded in the South Island.

Southland recorded growth of 9.8 per cent, while the West Coast recorded 9.7 per cent and Canterbury 9.4 per cent.

Bay Paymark data

Last year: $223.1 million
This year: $231.6 million
Change: 3.8 per cent