Christmas retail figures fall

There is unease for retailers this Christmas as recent surveys show mixed messages about consumers’ spending in the winter period.

The Office for National Statistics (ONS) today (17 December) showed that retail sales in November fell at their fastest pace since May.

Total sales volume decreased by 0.3%, whilst non-food stores sales growth fell by 0.9%

However, the British Retail Consortium (BRC) is confident that retailers will enjoy a better Christmas than last year despite these figures.

And a survey by independent business analysts Datamonitor found that 70% of UK shoppers expected to spend more than normal over the next three to six months.

The study, carried out in September, found that UK consumers intended to increase their spending much more than the global average on key consumer goods that sell more at Christmas, such as clothes, shoes, confectionary, and fragrance.

Compared to when they were asked in June, the survey found that 5% fewer UK shoppers were intending to shop in discount stores and 8% fewer were intending to cut back on non essential items. 11% were planning to buy more expensive brands than in June.

When asked about their intentions for December and into the New Year, 37% of consumers thought that the recession had reached the bottom and the economy would start to recover soon, rising from 26% of consumers in June.

Richard Lowe, head of retail and wholesale at Barclays said: “The ONS figures today are surprising considering general expectations of rises in sales figures over the past month coupled with innovative strategies being adopted by retailers this Christmas season.

“More contemporary survey evidence suggests that sales have improved in December, although it remains to be seen to what extent the prospect of a rise in VAT on January 1 has displaced demand for big ticket items from future periods.”

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