Canadian Retail Sales Recovery Slows

Recovery in retail sales is cooling off, says Ed Strapagiel, a retail consultant. There was a huge COVID rebound in the second quarter after dismal year-ago results but that is now working its way out of the picture. eCommerce is also experiencing the same cooling off pattern as all major retail sectors. The store merchandise sector had high year-over-year retail sales gains in the second quarter of this year, largely because of pandemic-induced declined performance a year ago. This is now abating and sales trends are returning to more normal levels. All store types in the store merchandise sector had positive year-over-year retail sales gains for the quarter. Furniture and home furnishings retail sales were up 13.2 per cent and general merchandise stores' retail sales were up by a more modest but solid seven per cent. Electronics and appliance stores were the poor cousin of the sector with a gain of just 1.1 per cent. Canadian eCommerce retail sales had increased significantly due to the COVID pandemic, as many retailers had to suspend in-store shopping and many consumers became reluctant to socialize. The explosion in retail eCommerce now appears to be past its peak. For the second quarter, sales were up just 2.9 per cent versus a year ago, the lowest such result since the numbers have been kept. There's even a chance that eCommerce sales will decline in the next few months as in-store shopping restrictions are eased. Overall eCommerce represented about 6.4 per cent of total Canadian retail sales over the past 12 months.