Christmas sales in the balance as high street frozen out

Christmas trading "hangs in the balance", retail experts today warned after figures showed high street sales growth slowed last month.

• The Christmas High Street Boxing Day sales have started early, as shops try to grab as much shopping business as possible Picture: Phil Wilkinson

The data covers the period before heavy snow wiped hundreds of millions of pounds off retailers' takings, with hopes now resting on a pre-Christmas rush as shoppers race to beat January's VAT rise.

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The British Retail Consortium (BRC) revealed that like-for-like sales values increased by just 0.7 per cent year-on-year in November, adding that underlying volumes were virtually flat once inflation had been stripped out.

Like-for-like sales growth dropped slightly from 0.8 per cent in October as consumers restricted their spending because of fears over their financial security and uncertainty over the economy.

The BRC described November as another "difficult" month for retailers.

This month's sales are expected to be hit by the adverse weather, but the consortium hopes that retailers will make up the sales in the next three weeks.

BRC director general Stephen Robertson said: "With the final run-up under way, Christmas performance is delicately poised.

"Retailers will be hoping disruption eases so that sales lost early in the month are made up over the next couple of weeks and not lost entirely."

Today's figures follow data from Synovate Retail Performance, which showed the number of people visiting Scottish stores fell by 36 per cent between last Monday and Thursday.

The latest high street sales tracker from accountancy firm BDO yesterday warned that internet sales were also being affected by the snow, with some shoppers worried about goods being lost in the snow-induced delivery backlog.

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But some stores are bucking the trend, with John Lewis reporting a 98 per cent year-on-year rise in online sales.

And the BRC thinks consumers continue to grow more comfortable with spending online, although internet sales still account for just 6 per cent of retail spending.

The BRC disagrees with BDO and thinks the cold snap is expected to further boost internet sales in December as consumers opt to stay indoors and wait for deliveries rather than brave the elements on the high street.

Yesterday was branded "Uber Monday" by online retailers, which expected consumers to shell out more than 633 million on Christmas presents.

The BRC figures show clothing sales returned to growth after the first decline in almost a year in October as the coldest November since 1993 prompted consumers to buy winter outfits.

Sales of footwear, particularly boots, were also boosted by the winter weather and fashion trends although general womenswear continued to struggle.

Food sales were also strong last month, mainly as a result of inflation, with consumers snapping up traditional treats such as luxury Christmas puddings.

The cold weather prompted consumers to buy hearty food such as soup, pies and puddings.

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Meanwhile, a survey by accountancy firm RSM Tenon revealed the number of retailers that fell into administration decreased in the third quarter of the year at a slower rate than other sectors of the economy.

The firm fears the VAT increase on 4 January could create a wave of retail administrations..