Latest News

Two weeks in the UK - 31st January

With the first month of post Christmas trading now under their belts retailers are focussing all their efforts on new product and the new season and all are fighting hard for market share as 2012 finally gets going.

It is likely we will continue to see intense competition amongst retailers – particularly in the grocery sector with a salvo already fired by Morrisons with the revelation it was to take on 10 of the former Best Buy stores which it will convert to nursery and baby goods retailers Kiddicare – the business it now owns.

Despite the seemingly positive results for sales in December from the likes of the BRC and the ONS the latest figures from the CBI published in the last fortnight showed that January has seen consumers tightly rein in their spending with the CBI reporting the biggest fall in retail sales in three years.

In the monthly CBI Distributive Trades Survey covering the first two weeks in January, 44% of retailers saw sales volumes fall on a year ago, while 22% reported a rise, giving a balance of -22%. This was the lowest since March 2009 (-44%), although it was broadly in line with expectations according to the CBI.

Retailers reported sales were disappointing for the time of year (-20%) and orders were also down (-14%), with firms expecting levels to fall again next month (-23%). Stock levels remained constant, but fairly low, in line with recent months (+10).

Retailers expect annual sales volumes to continue to fall in February, albeit it at a slower pace than this month (-10%).

This was reflected in footfall figures from Experian FootFall for the week to 22 January which was down 3.5 per cent for the week and 3.9 per cent year on year – the third and largest drop this year. Experian said the 3.5% week-on-week drop was typical as consumers awaited their first pay packet of 2012. With that pay packet having now arrived retailers will be hoping that customers begin looking forward rather than back.

As the post-Christmas shakeout continued there were further administrations with Peacocks succumbing after its bank pulled funding earlier in the month. But for some post administration businesses there will be a renewed focus and investments in the brands under new owners.

Barratts Priceless collapsed into administration before Christmas, but it was revealed this week that its Dolcis brand will relaunch for spring 13 to target the young women’s fashion market after being bought by Jacobson Group. The brand is likely to err towards department store concessions and online rather than high street stores however.

Meanwhile 60 of La Senza’s stores were sold to Alshaya who are planning a major focus on reviving the underwear brand through the refreshment of product and redesign of stores. And new owner of Blacks JD Sports has promised a return to, appropriately, the black for the outdoors chain within a year as it focusses on slimming down the store portfolio and revamping product.

The first few weeks of 2012 have been far from easy for the retail market with consumers more concerned about their finances than ever but as always in tough times those retailers that operate their businesses well now will boom further when the upturn happens.

© Loomis UK Limited, 6th Floor Regus, East West Building 2, Tollhouse Hill, Nottingham NG1 5FS - Registered number 3200432.
Cookies - Privacy - Terms Of Use - Copyright