The bearish market that characterised 2011 for Australia's retail industry would likely be replicated for the first quarter of 2012. A survey by Dun & Bradstreet showed that 55 per cent of retailers expect continued slowdown of consumer demand.

The impact of low wages and weak salary growth was cited by 34 per cent of survey respondents and the effect of online shopping on bricks-and-mortar stores was identified by 56 per cent of the respondents as the top of their worry list.

D&B Chief Executive Christine Christian explained that online retailers are at a disadvantage compared to traditional stores because of higher overhead and operating costs the latter experience.

For the first three months of 2012, 15 per cent and 22 per cent of the retailers expected their sales and profits to go down compared to the same quarter in 2011.

Ms Christian also cited uncertainty in the global economy as a negative factor behind the weak consumer confidence.

"As the world contemplates a second recession, it is inevitable that local businesses will begin to question how this may affect their business in the coming year.... As insulated as we have been so far from the turmoil in overseas market, a second global recession will undoubtedly have consequences for sectors of the economy," Ms Christian said.

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