Retail Trade, September 2020

Retail sales rose 1.1% to $53.9 billion in September—the fifth consecutive monthly increase since the record decline in April. Core retail sales—which excludes gasoline stations and motor vehicle and parts dealers—also rose 1.1%, on higher sales at general merchandise stores and food and beverage stores.

Retail sales were up in 9 of 11 subsectors, representing 93.2% of retail trade. In volume terms, sales were up 1.1% in September. Rounding out the third quarter, retail sales were up 22.6% compared with the second quarter. In volume terms, retail sales rose 21.5%.

Given the rapidly evolving economic situation, Statistics Canada is providing an advance estimate of retail sales, which suggests that sales were relatively unchanged in October. Owing to its preliminary nature, this figure will be revised. This unofficial estimate was calculated based on responses received from 50% of companies surveyed. The average final response rate for the survey over the previous 12 months has been 88.5%.

Sales up in eight provinces
In Ontario, sales rose 1.0% with general merchandise stores leading the growth. In the census metropolitan area (CMA) of Toronto, sales increased 1.2%. In Alberta, retail sales were up 2.5% in September, led by higher sales at motor vehicle and parts dealers. Higher sales at motor vehicle and parts dealers also drove the sales growth in British Columbia (+1.7%). In the CMA of Vancouver, sales rose 0.9%. Sales in Quebec rose for the fifth consecutive month, edging up 0.2% in September. In the CMA of Montréal, sales were up 0.4%.

Retail e-commerce sales in Canada up by three-quarters year over year
On an unadjusted basis, retail e-commerce sales reached $3.2 billion in September, accounting for 5.6% of total retail trade. The share of e-commerce sales out of total retail sales rose 0.5 percentage points from August—despite more retailers expanding in-person shopping in accordance with public health measures—and was up 2.1 percentage points year over year.

Retail e-commerce sales were up 74.3% year over year in September, while total unadjusted retail sales increased 9.3%. When adjusted for basic seasonal effects, retail e-commerce rose 8.1%.

Wholesale Trade, September 2020

Wholesale sales grew 0.9% to $66.2 billion in September and remained higher than February’s pre-COVID-19 level for the third straight month. In September, four subsectors recorded higher sales, with the food, beverage and tobacco and the personal and household goods subsectors contributing the most. In volume terms, wholesale sales fell 0.2%.

Third quarter sales
The nature of the wholesale sector and the substitutions Canadians made in their everyday spending over the first six months of 2020 have allowed the sector to remain strong despite the severe economic impact of the pandemic elsewhere. The strength in the wholesale sector does not reflect an economy-wide recovery from the pandemic. It is more likely the fact that the wholesale sector has been the beneficiary of decisions by Canadians to spend money differently than they have in the past (a substitution effect), and an increase in Canadians’ disposable income.

In the third quarter of 2020, the wholesale sector grew rapidly, indicating that it has been able to recover well from the original shock of the pandemic. Sales in the quarter grew 20.1% to $197.4 billion—the highest level on record. Notably, sales were higher than both the first quarter of 2020—which included a rail strike in Canada and the first few weeks of the impact of the pandemic—and the fourth quarter of 2019. This increase was also reflected in the constant dollar measures of the wholesale sector, where sales have also grown beyond pre-pandemic levels. Constant dollar sales in the third quarter were 1.7% higher than in the first quarter of 2020 and 1.1% higher than in the third quarter of 2019. Total sales for the first nine months of 2020 were $553.3 billion, which was 3.3% lower than in the same period of 2019.

Port of Montréal strike
Notwithstanding the increase in wholesale sales in August and September, about 7% of survey respondents indicated that the strike at the Port of Montréal had a negative impact on their business over those two months. Even though the strike ended in August, the backlog at the port cost wholesalers approximately $600 million in sales over the two months. 

Higher sales in seven provinces
Sales increased in seven provinces in September, accounting for more than 90% of total wholesale sales and led by Quebec and Ontario. Sales in Quebec grew 2.8% in September to $12.8 billion, the fifth consecutive monthly increase. Ontario wholesale sales rose 0.9% to an all-time high of $34.3 billion in September.

Inventories rise
Wholesale inventories increased by 0.7% to $90.7 billion in September. It was the second straight positive month after three consecutive months of declining inventories. The gain is consistent with the 0.7% increase reported by the Monthly Survey of Manufacturing.

The inventory-to-sales ratio was unchanged at 1.37 from August to September. This has been the lowest level since August 2018. The inventory-to-sales ratio is a measure of the time (in months) required to exhaust inventories if sales were to remain at their current level.

Source: Statistics Canada
Source: Statistics Canada