Price wars underpin rise in high street retail sales

THE high street is in “rude health”, with retail sales climbing 1.6 per cent last month despite being up against tough comparatives in January 2014, the industry trade body claims in a report out today.
Retail: 'Rude health'. Picture: GettyRetail: 'Rude health'. Picture: Getty
Retail: 'Rude health'. Picture: Getty

However, the latest British Retail Consortium-KPMG retail sales monitor also points to a gathering predicament for retailers, in that consumers were increasingly putting off purchases until the January sales.

Total sales in January 2014 had leapt 5.4 per cent, it said. The report for January of this year also revealed that like-for-like revenues, stripping out new floor­space, edged up 0.2 per cent, again advancing on the sharp 3.9 per cent rise 12 months earlier.

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Helen Dickinson, director general of the British Retail Consortium, said the findings gave cause for optimism because “last year retailers had a bumper January so to see growth against such a tough comparison shows the industry to be in rude health”.

She said retailers had made sure they “have the right stock at the right price”.

The monitor showed that the trend for shoppers to buy over the internet continued to gain momentum, with total non-food online retail sales jumping 11.7 per cent last month.

David McCorquodale, head of retail at KPMG, sounded a more restrained note, saying the January increase was a “semi-revival in fortunes” after a subdued ­December.

He said that shoppers capitalised on the bargains on offer in the January sales, but added: “These figures demonstrate the difficult cycle that retailers are trapped in.

“Demand is now almost solely driven by discounts, with shoppers very reluctant to buy goods at full price in the hope that yet another sale could be just around the corner.”