Generous discounts boost retail spending

Retailers reported a bumper start to the Christmas trading season yesterday as shoppers defied the ice-cold weather and hit the high street.

Customers started the Christmas season with zeal, with big names reporting a 10 per cent hike on last year's sales.

Stores including Marks & Spencer, Debenhams, Currys, Argos and House of Fraser also slashed prices by up to 50 per cent in an effort to draw in customers.

Official figures recently revealed that retail sales were picking up momentum ahead of Christmas, but economists expect consumers are also looking to make purchases before the January VAT increase, from 17.5 per cent to 20 per cent, comes into force.

Department store group John Lewis said shoppers throughout the UK, including Scotland, were not deterred by plummeting temperatures and saw sales last week total 99.9 million, up 13 per cent on the previous week and 8.7 per cent on last year.

The group said toys and digital items were the strongest sellers, with scooters, Butterscotch the animatronic pony, iPods and cameras also among the most popular products.

Grocer Waitrose, which is owned by the John Lewis Partnership, saw sales of 103m in the week ending yesterday, an 11 per cent increase on the same week last year.

Richard Dodd, spokesman for the British Retail Consortium, said: "There's more discounting and promotions going on in response to the difficult situation facing consumers, such as VAT and National Insurance rises.

"People are reluctant to make major spending commitments, so retailers are working extra hard with lots of discounting."