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Canadians still chose retailers over discounters during holidays: Moneris


January 13, 2009
By Moneris Solutions

Jan. 13, 2009 – Moneris Solutions, a Canadian processor of debit, credit and gift
card payments released its 2008 holiday season data that revealed
resilience and – for some merchant categories – dramatic growth in consumer
spending across the country.

Moneris Solutions, a Canadian processor of debit, credit and gift
card payments released its 2008 holiday season data that revealed
resilience and – for some merchant categories – dramatic growth in consumer
spending across the country. Department and apparel stores made significant gains in December, while
discount stores suffered the steepest credit and debit card dollar
volume decline of all merchant categories studied by Moneris.

“For months, there have been signs of a softening retail market, as
Canadians become more conscious and restrained in their spending
habits," said Brian Green, SVP, Moneris Solutions.  “Our national,
multi-method-of-payment data proves that in fact, Canadians continued
to spend during the holiday season and the number of transactions
actually rose over previous year.  These numbers offer merchants and
consumers alike a reliable pulse on the Canadian economy."

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Nationally, department stores saw the amount of money charged to credit
and debit cards climb by nine per cent, compared to the same time last
year. Apparel stores came in second place, with a six per cent growth
in credit and debit card sales behind department stores. 
Astonishingly, discount stores failed to live up to the growth
predicted by some retail analysts and actually suffered a decline of 11
per cent in credit and debit card dollar volume. Their wholesale
counterparts similarly weathered a substantial decline this holiday of
nine per cent.  The average ticket size of each transaction [across all
merchant categories] decreased by three per cent, which is attributed
to the discounts offered by retailers, lower gas prices and the overall
economic climate.

Nearly every major merchant category experienced spikes in consumer
spending on credit and debit cards from the second to the third week of
December compared to the same weeks in 2007. This reflected the
aggressive and early discount strategy retailers deployed to entice
shoppers off the streets and through their doors. Increased spending
activity was most dramatic in department and apparel stores (up six per
cent and nine per cent respectively), as well as electronics (up 11 per
cent) and jewellery retailers (up 21 per cent).  However, only
electronics retailers sustained growth into December's final Boxing Day
week, with national sales rising 17 per cent from the previous week.

Restaurants fared remarkably well with much narrower weekly declines
last month compared to December 2007. Moreover, eateries prolonged
their mid-December spike with a healthy increase of eight per cent in
the last week of the month compared to the same week last year
(although they were down an overall six per cent for the month compared
to December 2007). Drug stores and jewelry retailers were the least
volatile performers in December 2008, down just 1.5 and one per cent
respectively from last December. Nationally, all merchants pulled in
2% more in the month of December compared to the same time last year,
and seven per cent more in the final week alone, ending what began as a
pessimistic holiday season on a relatively bright note.

Across the country, December 22nd was the busiest shopping day for
credit cards, while debit cards were most used the next day as
Canadians filled up their gas tanks to visit their families.

“Canadians braved both the economic climate and December's inclement
weather to go on and spend more this December than they did last year."
continued Green.

Moneris's data covers all merchant categories and tallies the dollar
value as well as the number of transactions made on its debit and
credit card terminals at retailers across Canada in December 2008. The
company's infrastructure helps merchants process high volumes of
transactions and payments quickly and securely.


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