Heavy weather forecast for retail trade
Stores are preparing themselves for a bleak Christmas as economic indicators show poor retail footfall and low consumer confidence.
The British Retail Consortium said its retail sales monitor, produced with accountancy firm KPMG, showed sales “worryingly weak” as Christmas approaches, with October sales down 0.6% on a like-for-like basis against a year ago.
Credit services firm Experian’s Footfall Retail Index showed a year-on-year decline of 10.2% in the week commencing October 31.
The UK Retail Traffic Weathermap, produced by research company Synovate, showed overall UK footfall down 2.8% in October, with shopper visits down 10% in Scotland and Northern Ireland.
The BRC’s consumer confidence report, produced with Nielsen, showed that 86% of the UK population think the UK is still in recession and have increased job fears, though the number of consumers feeling negative about the state of their personal finances is at its lowest level for more than a year.
“Shoppers are remaining cautious and managing what they spend more closely,” said Nielsen’s UK managing director Chris Morley. BRC director general Stephen Robertson added: “There’s not much to be cheerful about.”
Helen Dickinson, head of retail at KPMG, said: “To whatever extent sales are being made, margins and profits are being impacted to stimulate demand as retailers strive to cope.”
Emmanuel Hembert of global management consultant AT Kearney said: “The UK high street faces a moment of truth. It is gearing up to capture the consumer festive spend, but the battle for share of wallets will be fierce.
“An early indicator that the high street is preparing for tough trading conditions lies in the fact that retail jobs have not yet picked up as they usually do, a hint that temporary hiring for Christmas has so far been muted this year.”