Sales at big retailers Briscoe Group and Hallenstein Glasson have tumbled in the past three months as consumers tighten their belts.
The retailers say their half-year results will lag behind last year's.
Briscoe Group, the owner of the Briscoes Homeware, Rebel Sports and Living & Giving chains says sales fell 11% to $77.8 milion in the October quarter compared with the same period a year ago.
When Labour Day is accounted for, sales fell 8%.
Managing director Rod Duke expects the second half result to be behind last year's $11.9 million profit and says it will be heavily dependent on the Christmas period.
Clothing retailer Hallenstein Glasson says sales for the three months to October fell 6.7% on the same period last year.
The company says projected earnings for the six months to February are difficult to predict, due to the uncertain nature of the market and the significant impact that Christmas has on earnings.
Directors advise that profit will be considerably below the previous year's profit, given current trends.
