Christmas is approaching quickly, and many Australians are feeling the pinch as the cost of living crisis continues to impact their budgets. 

According to the Australian Retailer Association (ARA), holiday sales in 2023 are expected to closely resemble the trends of the previous year. Shoppers are tightening their belts as inflation remains a challenge to manage. 

Paul Zahra, the chief of the ARA, pointed out that while there is a marginal increase in spending, it’s mainly due to supply chain price hikes, particularly in food, and the overall increase in the Australian population.

However, excluding these factors, the overall Christmas spending projection is on a downward trajectory. Research by Afterpay supports this observation, with many Australians planning to stick to a strict budget and hunt for the best festive deals. The holiday season can be stressful, and for many, it’s a busy period.

Last year’s Christmas spending saw a surge in “freedom spending” as Australians stayed put due to pandemic restrictions and limited flight schedules. This year, with more domestic and international travel options available, Australians are expected to be more conservative in their shopping budgets due to the current cost of living pressures.

The provisional forecasts for Christmas spending in 2023, as predicted by the ARA in collaboration with Roy Morgan, indicate that approximately $66.8 billion will be spent in the November to December 24 Christmas trading period, showing a minor increase of 0.1% from the previous year.

Food spending is expected to account for a significant portion of the overall spend, reaching $26.7 billion. 

This is driven by supply input price increases, and research from Afterpay reveals that one in five people spends more on Christmas lunch than in any other month of the year.

Categories such as hospitality, household goods, and clothing are expected to soften in the lead up to Christmas, while department stores and other retailing categories are set to record sales growth compared to the previous year.

Despite the projected softening in overall pre-Christmas spending, the popularity of Black Friday is expected to continue, with retailers offering significant discounts during this time. Black Friday and Cyber Monday are anticipated to see a $6.36 billion spend across the four day weekend, up 3% from the previous year.

To save money this Christmas, consider shopping early, planning ahead, asking for wish lists, using click and collect, checking delivery times, and taking advantage of electronically sent gifts. 

Additionally, don’t forget that post Christmas and New Year sales can also provide great opportunities for bargains.

In conclusion, the 2023 holiday season in Australia will require careful budgeting and an eye for value-based shopping. Shoppers are encouraged to plan ahead, shop early, and make the most of the opportunities offered by Black Friday and post Christmas sales.

To keep on top of trends and what is happening in the Aussie finance market, be sure to follow us here at Laura Moya Local Mortgage Broker, and of course if we can be of any assistance, don’t hesitate to get in touch.

References –

• Forbes Advisor
• Afterpay
• Australian Retailer Association (ARA)