Thursday, February 21, 2019

Xmas disappoints as retail LFLs rise 0.3%


Like-for-like (LFL) sales across the UK high street in December 2012 were up just 0.3 per cent as predictions of a disappointing Christmas proved true, according to the latest BRC-KPMG Retail Sales Monitor.

While total sales rose by 1.5 per cent last month, this is in comparison to a 4.1 per cent boost in December 2011, when LFLs had risen 2.2 per cent on the preceding year.

According to Helen Dickinson, Director General of the British Retail Consortium, the most recent growth is comparable with that of December 2010, when sales were severely affected by extreme weather.

December‘s sales growth also failed to beat inflation, in what KPMG‘s Head of Retail, David McCorquodale, has described as “a flat end to a flat year.”

Commenting on the results, McCorquodale said: “Retailers this year were perhaps better prepared for a sluggish quarter and held less stock throughout.

“The stand-off between retailers and consumers looking for bargains and discounts throughout December and, while some retailers will report record Christmas sales, most will breathe a sigh of relief because it could have been much worse.”

With many retailers releasing their Christmas trading results this week, Waitrose and John Lewis have already announced that this has been the best Christmas on record.

But grocer Morrisons reported disappointing sales as the growth boost enjoyed by food retailers in recent months looks to be coming to an end.

Retailers also suffered from a sluggish start to the Christmas shopping season, the effects of which failed to be overturned by last-minute panic buying later in the month.

Describing the results as “not a cause for celebration, but not a disaster either”, Dickinson also commented: “The final few days leading up to Christmas saw a last-minute sales boost, as many made the most of a full shopping weekend which the calendar didn‘t offer in the previous year.

“Footfall was disappointingly low but it seems that when people did make shopping trips they bought a lot in one go.”

Online retailers also drew shoppers away from the high street as online sales growth was at its highest since December 2011 with an increase of 17.8 per cent.

For the high street, the outlook remains bleak, McCorquodale warned, commenting: “January will be a tough month for retailers as consumers face up to their credit card bills after Christmas and it‘s likely 2013 will bring more of the same challenges.

“While consumer confidence remains low, shoppers will tighten their belts and rein in their spending, making life difficult for the average UK retailer.

“There will be no boom and it‘s likely more than a few will go bust.”