Annual retail trade, 2020
Increase in online shopping moderates the COVID-19 pandemic's impact on retail sales
In 2020, with the onset of the pandemic, retail sales were impacted, as consumers changed their shopping habits and retailers altered their business practices. Retail customers spent $669.6 billion at Canadian store and non-store retailers in 2020, leading to a slight decline of 0.1% in operating revenue compared with the previous year. The effects on retail sales varied throughout the sector as consumers and businesses dealt with regional lockdowns, labour shortages, plant closures, supply chain disruptions and increased operating costs related to the pandemic.
Retail prices notably increased for passenger vehicles (+2.4%), food purchased from stores (+2.4%), fresh vegetables (+3.0%) and meat (+4.5%). Inflation slowed to 0.7% in 2020 following a 1.9% increase in 2019, as lower gasoline prices offset higher food costs. Retail sales in volume terms fell by 2.0% in 2020.
Online retail continues to grow
In 2020, retail e-commerce sales grew by 85.7% after restrictions on in-store shopping pushed more consumers online and retailers adapted their service delivery. E-commerce operating revenue accounted for 7.8% ($52.5 billion) of total store and non-store retail revenue in 2020, up from 4.2% in 2019.
Motor vehicle and parts dealers and gasoline stations lead the decline in store sales
Changes in operating revenue varied significantly throughout the retail sector in 2020, with 5 out of the 11 store subsectors experiencing losses. These were concentrated in two subsectors: motor vehicle and parts dealers, and gasoline stations. Higher sales in food and beverage stores, general merchandise stores, and electronics and appliance stores mostly offset these declines.
In 2020, sales in the largest subsector—motor vehicle and parts dealers—decreased 7.0% to $161.5 billion, as new motor vehicle sales declined for the first time since 2009. New car dealers, which accounted for over three-quarters of all sales within the subsector in 2020, saw sales decline by 9.1% to $124.4 billion. According to results from the New Motor Vehicle Sales Survey, this decrease came from lower dollar sales of passenger cars (-30.1%) and trucks (-13.4%).
Operating revenue for gasoline stations fell 16.7% to $54.2 billion in 2020, the largest decrease since 2015 (-14.1%). This decline mainly came from lower fuel prices at gas stations, which fell 14.0% in 2020.
Sales rise at food and beverage stores and general merchandise stores
Sales increased 8.8% in the second largest subsector, food and beverage stores, reaching $142.9 billion in 2020. Grocery stores are deemed essential retailers in the context of the pandemic compared with restaurants, who were forced to restrict indoor dining, leading many consumers to change their spending patterns. According to the Monthly Survey of Food Services and Drinking Places, sales fell 28.2% in 2020.
In 2020, sales at general merchandise stores increased 7.6% to $78.8 billion. According to the Retail Commodity Survey, food at retail stores represented approximately one-third (32.8%) of sales at general merchandise stores in 2020, followed by home furniture, furnishings, housewares, appliances and electronics (21.9%).
Operating revenue down in nine provinces
In 2020, the operating revenue of store retailers fell in all provinces, with the exception of British Columbia, where it increased by 1.0%. Ontario led the decrease in total operating revenue (-$5.9 billion; -2.5%), followed by Alberta (-$1.9 billion; -2.3%).
Ontario (37.1%), Quebec (21.8%), British Columbia (14.1%) and Alberta (13.1%) accounted for the largest shares of operating revenue in 2020, representing a combined $541.2 billion (86.1%) of total operating revenue.
Margins move higher for Canadian store retailers
The gross margins of retailers rose slightly, from 26.5% in 2019 to 26.8% in 2020. Gross margins grew in 6 of the 11 retail subsectors. The strongest gains were recorded by electronics and appliance stores (+2.8%) and gasoline stations (+0.8%). Operating profit margins for retailers rose modestly, from 4.6% in 2019 to 4.9% in 2020.
The cost of goods sold by store retailers decreased by 1.7% to $460.1 billion in 2020. The cost of goods sold represented roughly 73% of total operating revenue.
Total operating expenses, including labour remuneration, shrank by 1.3% to $137.5 billion in 2020.
Looking ahead to 2021
The estimates in this release are for 2020. While the financial estimates for 2021 have not yet been finalized, a first glance at preliminary results is available in the December 2021 Monthly Retail Trade Survey data release. Retail businesses faced many challenges in 2021, including extreme weather, higher prices, supply chain disruptions and ongoing labour force issues.
Note to readers
Data have been revised for 2019.
Trucks include minivans, sport utility vehicles, light and heavy-duty trucks, vans, and buses.
As of October 17, 2018, the date of cannabis legalization, the Annual Retail Trade Survey collects and disseminates both store and e-commerce sales statistics for licensed cannabis stores.
For more information on online shopping, see the latest infographic, "Online shopping during the COVID-19 pandemic."
Data are collected for the 12-month fiscal period that ends on or between April 1, 2020, to March 31, 2021. For some businesses, this means reporting mostly on pre-pandemic operations. As a result, the effects of the pandemic are not fully reflected in the estimates for this reference year and will extend to the estimates for the 2021 reference year.
These and other data related to business and consumer services can be found at the Business and consumer services and culture statistics portal.
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