Wednesday, 07 July 2004 11:54
December retail performance, according to BRC-KPMG
.10/01/2012 | 10:34 — admin1
The BRC-KPMG Retail Sales Monitor covering the five weeks from 27th November to 31st December 2011, found that UK retail sales values were 2.2% higher on a like-for-like basis from December 2010, when sales had fallen 0.3%, hit by snow. On a total basis, sales were up 4.1%, against a 1.5% increase in December 2010. On both measures, and excluding Easter distortions, sales performance was the best since January.
Food sales growth picked up strongly and non-food also improved, but with sales often promotion-led. Clothing and footwear showed good gains on the previous December’s weak sales. In the furniture and floorcoverings sector, sales fell further below their year-earlier level. Underlying caution about big-ticket purchases persisted, with people worried about jobs, incomes and the housing market. New ranges, promotions and pre-Christmas delivery guarantees helped some, but forward orders were worryingly low. Fitted kitchens, bathrooms and bedrooms were mixed and often discount-driven.
Home accessories and house textiles sales rose above their year-earlier level after a weak November. Promotions and sales events helped, especially where consumers could justify purchases as replacement needs. Bedding and soft furnishings showed some uplift as the weather turned colder and people readied their homes for Christmas.
Stephen Robertson, BRC director general, says: “A better than hoped-for December closed a relentlessly tough year for retailers, but these figures hinged on a dazzling last pre-Christmas week and were boosted by some major one-off factors. We’re not witnessing any fundamental change in customers’ circumstances.
“The comparison is with severe snow disruption a year ago. Discounting was deeper and started earlier and the vital Saturday Christmas-Eve added another big trading day to the final run-up. Post-Christmas offers brought large numbers of shoppers out but that was generally a short-lived hunt for bargains. With discounting driving sales at the expense of margins the key question for retailers is about earnings from those sales.
“A solid December result hasn’t rescued a pretty miserable year. Whole-year figures show minimal growth in 2011. For many customers, economic reality has bitten again since the New Year and, with consumer confidence returning to levels last seen during the recession, 2012 is expected to be an equally challenging year.”
Helen Dickinson, head of retail, KPMG, adds: “December’s figures saw retailers achieve a 2.2% increase in like-for-like sales, albeit against a background of heavy discounting and long opening hours. Whilst these results must be viewed in a positive light, it must also be noted that they have come at the end of a year which witnessed declines in most non-food sectors and are against December 2010’s weak results, which saw sales badly affected by poor weather. Sadly no-one expects this level of demand to be indicative of the year ahead.”