Retail discounts fail to lure customers

Consumers are cutting “frivolous shopping” off their agenda, says the British Retail Consortium as it reports that UK retail sales value fell again in July by 0.9% compared with the same period last year.

The report says that retail trade remained tough even with widespread discounting. Food and drink was the only sector to show significant growth but that was against a weak July 2007, according to BRC.

Clothing and footwear fell further below the year-earlier level. Furniture and home wares remained well down on a year ago, despite continued discounts and promotions.

Helen Dickinson, head of retail at KPMG says: “As July 2007 was one of the worst performing months of last year, total sales growth of just 1.7% in July 2008 highlights how disappointing a month it was for all retail businesses.

“Although total retails ales and food sales grew compared to the same period last year, the non-food sector contracted for the second month in a row. The furniture and home-related sectors continue to bear the brunt of falling consumer confidence and increasing demands on household budgets.”

Director general of BRC, Stephen Robertson adds: “Four of the last five months have now seen negative like-for-like annual sales growth and in July ever sector except food recorded falls. Frivolous shopping is off the agenda as most customers concentrate on value and durability and there are few signs the slowdown has yet bottomed out.

“This is a good time for consumers to take advantage of the wide range of discounts and promotions available to them.”

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