Australian Retailers Association CEO Paul Zahra said lockdowns in NSW, Victoria and the ACT were threatening the survival of small businesses, and some discretionary retailers, particularly those in CBD locations.

“However, there is hope on the horizon with NSW set to start to open back up next month and Victoria and the ACT expected to follow suit,” Zahra said.

“The timing couldn’t be more important as retailers gear up for the festive trading season when most discretionary retailers make up to two-thirds of their profits for the year.”

NSW is promising to ease restrictions when vaccination rates hit 70 per cent, for people aged over 16 who’ve had two doses.

Research conducted by the association and Roy Morgan found Australians are set to spend over $11 billion on Christmas presents this year, with 79 per cent saying they plan to spend the same or more than they did last year.

“However, the immediate challenges remain around the lockdowns and a lot of pain continues to be felt in parts of the country where stay-at-home orders are in place,” Zahra said.

New figures from Mastercard SpendingPulse, which measures in-store and online retailing across all forms of payment, showed sales increased by 1.1 per cent in August compared to July, but were down 2.3 per cent from a year earlier.

The biggest annual falls were in clothing retailing, down 15 per cent, and department stores, off 3.5 per cent.

However, household goods sales rose 4.5 per cent and food retailing was up 0.2 per cent.

The Australian Bureau of Statistics will release retail spending figures for August on September 28.