The news from the high street over the past few months has been mixed, with some reports pointing towards an improvement in trading and others suggesting that difficulties still remain. The fact is that the picture is mixed. While some locations have experienced an upturn in sales, in other areas the picture remains very much the same with reduced consumer spending and rows of empty shops.
This makes it difficult to generalise when discussing retail trends and this appears to be the case with Christmas trading. Nevertheless figures released by accountancy firm BDO will disappoint those hoping that the retail sector has turned a corner.
The firm’s High Street Sales Tracker shows that mid-market retailer’s sales dropped by 2.2 per cent when compared to last year, despite the fact that consumer confidence has improved during the same period.
Fashion sales were particularly badly hit, experiencing a 4.6 per cent plunge year on year in December. This is despite the fact that November saw a 2 per cent rise when compared to November 2012, with consumers spending a total of £800 million in stores such as French Connection, GAP and Conran.
BDO LLP National Head of Retail and Wholesale, Don Williams, believes that the situation is unlikely to improve in the first month of 2014.
He says; “There is little room for complacency.
“January is a cruel month for the high street as retailers are usually sitting on high cash holdings and low stock levels so they are particularly exposed at this time of year.”
Many industry experts may be surprised at the lack of success for high street retailers, given that in the week before Christmas non-food sales rocketed by 55.7 per cent on a like for like basis.
This may be partially explained by the growing enthusiasm for online shopping, although as many high street retailers have now implemented click and collect services, the picture painted by BDO’s figures may not be as gloomy as they initially appear.
Infosys’ Vice President and Head of Europe – Retail, Consumer Goods and Logistics, Karmesh Vaswani, believes that the figures demonstrate a need for retailers to examine the wishes of consumers and personalise the shopping experience based upon the results.
He says; “Today, major retail chains need to create an ‘ideal store’ experience which meets the needs of local shoppers in each and every store.
“This requires new forms of close collaboration between retailers and FMCG suppliers to get the tills ringing.
“Those in the industry that get this right will reap the rewards in terms of increased sales and improved customer loyalty.”
Do you think there is any way that major high street retailers can regain market share from internet based rivals, or has the retail industry – and therefore consumer expectations of the shopping experience – changed irrevocably?
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