Cutting corners left space for Christmas luxuries

IT WAS not a very merry Christmas for the retail sector. Festive trading figures have been filtering through from the major high street players for the past three weeks, each of them more miserable than the next.

The Scottish Retail Consortium this week heralded the worst December since its records began in 1999, revealing that retail sales rose by just 1.7 per cent – a poor increase on a previous December which was itself blighted by heavy snow and ice which kept shoppers snugly indoors.

Even previously untouchable supermarket giant Tesco issued a profit warning – its first in at least 20 years – admitting that its Big Price Drop promotion had not lured customers through its doors over Christmas, while a raft of other big names – including Thorntons, Halfords, Argos-owner Home Retail Group and Mothercare – all reported disappointing December sales.

January was also a bleak month for employees of high street chains Peacocks and Bonmarche and gift shop group Past Times, which all fell into the hands of administrators just weeks after Christmas, while Scottish soft drinks maker Sangs collapsed, putting hundreds of jobs at risk.

But away from the big names, other types of stores have actually been thriving. From charity shops to upmarket, independent food stores, some types of retailer has reported a Christmas rush far above the general trend.

Retail consultant Gordon Emslie, of GNE Consulting in Falkirk said: “The stigma that maybe once would have been associated with charity and discount shops no longer exists. In addition, charity shops have become more of a business – a lot of them are selling a very high quality product, which is attracting people through the doors.”

He added: “At the other end of the scale, there is the feeling that people were willing to trade up at Christmas – to have that feel-good factor at Christmas and have a feeling that they are treating themselves.

“There are a lot of smaller delis which are doing well. I’ve spoken to quite a few in the West End of Glasgow who said they had a fantastic Christmas.”

Simon Lloyd, owner of Henri’s of Edinburgh, which has two branches in the city, saw luxury products such as foreign cheeses, foie gras, Martin Wishart branded smoked salmon, caviare and truffles fly off the shelves over the Christmas period.

He said he sold £1,000 of cheese in each of his shops every day in the five days before Christmas, while total sales in the Morningside branch – the only one which has been open for more than a year – went up by 5 per cent.

“It was amazing,” he said. “We felt that people were determined to enjoy themselves. It is that feasting element over Christmas which never really goes away, even when times are hard. I think people who perhaps had been more careful through the year wanted to treat themselves.”

At the other end of the spectrum, charity shops have been booming as bargain-hunting shoppers turned to cut-price goods to save cash on the Christmas present budget.

About one-third of people in Britain bought Christmas presents from charity shops, according to the Charity Research Association.

Shelter Scotland said its 34 Scottish shops saw turnover rise by 8.5 per cent in December, while Marie Curie Cancer Care said sales had rocketed by 19 per cent over the same period in its stores north of the Border.

Alec Barclay, Marie Curie’s head of shops, said: “The boost can be attributed to a number of factors – shoppers searching for value for money, mild weather and the introduction of additional Sunday trading.”

Cancer Research UK said it had witnessed a higher number of people looking to find presents in its 79 Scottish shops.

Lynn Muller, its head of product operations, said: “We think growing numbers of people are coming into our shops to buy thoughtful gifts for loved ones such as vintage jewellery, books or even records.”

Mysupermarket.com, which allows consumers to compare the cost of their shopping lists at all of the major supermarkets before doing the grocery shopping online, said user numbers had risen by 140 per cent, against the previous December. Its busiest period was 5-19 December.

James Foord, vice-president of business development at the website, said: “We actually saw the average trolley cost drop by over £10, but saw a slightly higher proportion of customers buying certain luxury items such as Champagne.

“We also noticed no ‘downshift’ towards own brand products. This suggests that our customers have been able to find better value on the things they buy regularly so that they can still afford some of the luxuries.”