Retailers frozen out in worst January for 15 years
9 Feb 10
Bad weather contributed to a grim January for retailers, according to statistics compiled by the British Retail Consortium and KPMG
Heavy snow in early January boosted food sales as customers stocked up, but a slump in demand for other items saw total retail sales by value fall 0.7 per cent on a like-for-like basis from January 2009.
Over the month, food, clothing and footwear showed gains on a year ago, but homewares and furniture showed declines. Non-food non-store sales (Internet, mail-order and phone sales) in January were 14.6 per cent higher than a year ago compared with 26.5 per cent in December. Some benefited from shoppers buying online when snow prevented them from getting out, the study says.
David McCorquodale, head of retail, KPMG in Scotland, said: “A very mixed performance in January which was impacted by a number of factors. The snow in the early part of the month caused consumers to stock up on food related items as travelling the country became treacherous while non-food suffered. As the month progressed, clothing and footwear picked up considerably but other non-food sectors continued to show weakness.
“Although the results were flattered by the impact of higher shop prices, given the higher VAT rate in January 2010 compared to January 2009, this was less pronounced than in December. The underlying trend is difficult to read but there is no doubt that the strong sales we saw in December 2009 are not indicative of the trend for the rest of this year.”
Stephen Robertson, director general of the British Retail Consortium, said: “An awful start to the year and in stark contrast to an upbeat December. This is the worst January sales growth in the 15 years we’ve been running the survey… The VAT change brought some sales forward to December, but customers are becoming cautious again in the face of economic and political uncertainty. Retailers will be hoping these results are mainly a snow-induced blip, rather than an indication of further difficulties.”