New Australian Retailers Association research found 55 per cent of small to medium-size retailers are uncertain or concerned about their futures, while 43 per cent are falling short of financial benchmarks.
Slowing consumer spending is the most pressing concern for the retailers, along with wage costs, cost of goods and services, and staffing shortages.
And ARA CEO Paul Zahra issued an ominous warning to businesses, suggesting the run into Christmas could bring even more pain.
“Discretionary retailers are at the coalface of this pressure as we head into the Christmas trading period, when most discretionary retailers make up to two-thirds of their profits,” he said in a statement.
“Our small retail community is feeling the crunch as shoppers scrutinise their spending and costs continue to increase across the board – wages, rent, utilities, insurances and supply chain costs.”
More than half (54 per cent) of the respondents have had to pass on higher costs to customers, a massive jump from just 24 per cent four months ago.
Retailers are responding by driving investment in customer acquisition and loyalty, while also exploring new avenues through artificial intelligence and e-commerce.
Zahra lauded their “extraordinary resilience” to try and innovate their way to a better position.
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