Two weeks in retail - 19th June
With the summer solstice, and therefore the official start of summer, this week retailers will still be waiting for the weather to recognise the occasion too, especially as for many their summer Sales are beginning this week before they’ve even truly had a proper stab at full price selling of their ranges.
The continued mixed weather – a cocktail of sun, rain and gales in the past fortnight alone – has continued to plague retail sales.
At least there will be a temporary buoy from today’s Office of National Statistics inflation figures which show that UK inflation dropped to 2.8% in May, with the CPI measure down from 3% the month before. The largest downward pressures came from motor fuels and food and non-alcoholic beverages. RPI annual inflation meanwhile stands at 3.1% for the month, also down from April when it stood at 3.5%. Petrol and oil and food prices were the largest contributory downward pressures on the figures.
Retailers have in general been celebrating from the results of the extra-long bank holiday Jubilee weekend – and the half term break that followed it – which did bring cheer for some as the nation joined in the celebratory spirit whether they were truly patriotic or not.
In the seven days for June 3, including the Queen’s Diamond Jubilee weekend, footfall rose 8.6% according to Experian and an 11% increase year on year for the Saturday.
At John Lewis the fortunate combination delivered a whopping 18.1% jump in sales to £63.1 million for the week. It said Father Day and Olympic related spending all also added to the uplift. Electricals saw a 46.6% surge as customers invested in large screen TVs for a summer of sport but fashion fared less well with only a 3.9% uplift.
At grocer Sainsbury’s, Jubilee spending droves sales by 1.4% on a like-for-like basis for the first quarter with a 3.6% rise in total sales for the 9 weeks to June 9. Tesco meanwhile reported £1 billion in sales in the run up to the Diamond Jubilee weekend not contained within its reported figures.
And despite the current cash strapped times being suffered by many shoppers luxury leather goods retailer Mulberry reported a 54% rise in pre-tax profits up 54% to £36million for the year to March 31 and sales up 38% to £168.5 million.
There was reason too for celebrations at Majestic Wine which reported a rise in full year pre-tax profits of 14.5% to £23.2 million in the 53 weeks to April 2 and sales up 8.9% to £280 million. The retailer also benefited from the Queen’s Diamond Jubilee with a 0.6% uplift in sales for the 10 weeks to June 11 as consumers toasted the occasion in style.
At M&S the retailer revealed plans for its launch into the banking world with 50 branches planned within two years. The new venture will be run in partnership with HSBC with the first branch opening next month in its Marble Arch flagship store.
But yet again there have been further failures too. Department store Allders, backed by Harold Tillman, collapsed into administration last week following a decline in sales. The store, which is based in Croydon and had had offers of help from both its landlord and Croydon Council to try to prevent its collapse, currently remains open for business.
With the Jubilee celebrations now over retailers are focussing on the summer of sport that follows it. Whether that captures the imagination and purse strings of shoppers in the same way has yet to be seen.