Initial reports say Christmas sales were strong in British Columbia, but not as strong as last year, as the industry prepares for a “softening” of the retail environment. (Black Press File).

Retailers in B.C. preparing for slower growth, higher costs in 2019

British Columbia, once a region of strength, has gone soft for retailers

Christmas sales were strong, but not as strong as last year, says a leading retail analyst, who predicts a “softening” for the retail industry in 2019.

Greg Wilson, director of government relations in British Columbia for the Retail Council of Canada, made these observations as the industry prepares for a slow-down after five strong years of growth.

More information will become available in two months when Statistics Canada releases retail figures for December. The most available retail figures for October show sluggish retail sales.

RELATED: Canadians spent $1.7 billion dollars online in December 2016

Whereas British Columbia was once a strong market for retailers, it is among the weakest in the country, he said, pointing to the Retail Council of Canada’s Holiday Retail Conditions Report that the organization compiles through interviews with members.

“The slow-down in British Columbia has become more widespread, with the majority of members saying it is now one of their weaker regions,” it reads. “The softness occurs in all parts of the province.”

There are several reasons, according to Wilson. First, the slow down in real estate has impacted retail. Second, retailers, especially in parts of Greater Vancouver are struggling to retain staff, because of low wages relative to local housing costs, a phenomenon also apparent in other parts of the province such as Whistler.

Retailers in the Greater Victoria have also complained about the absence of staff, citing housing and transportation costs as factors.

READ ALSO: First stores open in Victoria’s expanded Mayfair shopping centre

Other issues also loom, said Wilson, including the Employers Health Tax (EHT) effective Jan. 1 and a higher minimum wage effective June 1.

While the retail council welcomes some of these measures, they are opposed to others, said Wilson.

He is concerned about the EHT, which replaces the Medical Service Premiums (MSP), with the proviso that the provincial government collects both in 2019.

This double-dipping punishes what Wilson called “progressive” retailers, who already pay their employees’ MSP.

Issues beyond the borders of the British Columbia may also keep up retailers at night.

“Like their customers, retailers are very aware it is an uncertain world,” reads the council’s internal assessment. “The items in the big picture – trade disagreements, a slower economy, geopolitical tension, the exchange rate, technological change, cost and competitive pressures – intrude when retail execs are trying to get to sleep.”

The council’s internal reporting says most retailers are planning for “very modest increases in sales, characterized by flat store sales and strong online increases” with overall sales growth in the two per cent range.

The retail environment is “softening,” said Wilson. But he notes this development is relative, he said.


Like us on Facebook and follow us on Twitter

wolfgang.depner@saanichnews.com

Just Posted

Only steps away: Gutsy Walk returns to Kelowna

The walk to cures for Crohn’s disease and colitis comes June 2

Okanagan Regional Library hosts famous author

Author of The Woo Woo, Lindsay Wong will be in Kelowna Tuesday

Mainly sunny Victoria Day in Okanagan-Shuswap

The South Okanagan is the hottest spot to be in the province for Victoria Day

Five youth-led “positive change” projects in South Okanagan receive $9,500

Central Okanagan Foundation for Youth and United Way’s GenNext give money to projects

Kelowna firefighters douse blaze in hedges

The cause of the fire on Renfrew Road is under investigation.

QUIZ: Test your knowledge of Victoria Day

How much do you know about the monarch whose day we celebrate each May?

Update: Plan to see more smoke from South Okanagan wildfire

Richter Creek wildfire, 12 kilometres west of Osoyoos, is an estimated 400 hectares

Search crews rescue kids, 6 and 7, stranded overnight on Coquitlam mountain

The father and two youngesters fell down a steep and treachorous cliff while hiking on Burke Mountain

Woman who died at Shuswap campground remembered as loving mom

Sister raising funds to travel from Scotland to support family after tragedy

Raptors beat Bucks 118-112 in 2OT thriller

Leonard has 36 points as Toronto cuts Milwaukee’s series lead to 2-1

South Okanagan runners take top spots in Peach City RunFest

Both the top male and female half-marathon winners were from Penticton

Former Greyhound Canada employees gather in Okanagan to say a final farewell

“Greyhound may take our jobs but they will never take our friendships,” says former bus driver

‘Teams that win are tight’: B.C. Lions search for chemistry at training camp

The Lions added more than 50 new faces over the off-season, from coaching staff to key players

B.C. VIEWS: Reality of our plastic recycling routine exposed

Turns out dear old China wasn’t doing such a great job

Most Read