The British Retail Consortium announced today that retail sales fell across the UK by 0.1% on the like-for-like sales in October as the public are restricting their spend to essential items such as food and beverages.
Stephen Robertson, Director General of the British Retail Consortium said, “Falling consumer confidence means people are limiting spending to essential items and are cautious about committing to big-ticket and discretionary buying.”
These statistics mean that retail sales have grown at their slowest rate for almost a year. Stephen Robertson also said that online sales were particularly poor in October stating that the last three months include the two weakest growth rates in four years. With 10% of all UK sales taking place online, this is a reminder that although there are some signs in other parts of commerce that there are some ‘green shoots’ emerging – the retail sector is not faring well.
Today Marks and Spencer announced a fall in profits of just under 10% a result of the downturn in clothing sales. For the same period compared to last year (6 months to end of September), their profits were down 9.7% to £290m.
These findings increase the nervousness around pre-Christmas sales, particularly given the poor results announced by Marks and Spencer and the collapse of the electrical chain Comet.
It looks set to be an increasingly tough time for retailers on the high street as Christmas looms but it seems it’s not all doom and gloom. Asos and Debenhams have both managed to buck the trend and have reported strong results. Debenhams are set to create a further 1,700 jobs and increase sales by £150m.
A focus on the US and Australia has paid off for ASOS where they have seen strong sales results. Profits grew to 42% for the 5 months up until the of August 2012.
Marks and Spencer
British Retail Consortium http://www.brc.org.uk/brc_news_detail.asp?id=2321&kCat=&kData=1