Recession-busting September helped by proper Autumn
High street spending leapt 6.1% in September, capping a spectacular summer on the high street.
The best summer like-for-like sales figures at medium-sized retailers for five years indicate shoppers are not worried about ominous economic predictions.
BDO’s September High Street Sales Tracker reveals fashion sales grew 5.7%, helped by the arrival of wind and rain at the end of the month which sent shoppers scurrying to snap up Autumn ranges of boots and coats. This was in stark contrast to last September’s drop of -1.7%, when a late ‘Indian summer’ saw shoppers more interested in picnics than parkas.
Non-fashion, buoyed by strong performances in the luxury sector, grew by 6%, but the real surge in demand came from the homewares market, which hit 10.2% growth – a staggering reversal of last year’s figure of -2.8%. Conscious of the higher VAT rate looming at the beginning of next year, homeowners have been splashing out on big ticket items now.
Mindful of the impending rise, retailers have refused to enter into price wars, preferring instead to cushion the blow by building the rise into prices now.
Don Williams, Head of Retail at BDO LLP says retailers are also being smarter about managing stock.
“The high street has improved its planning, erring on the side of being under, rather than overbought, focusing on keeping margins high and avoiding being lumbered with mountains of excess stock.”
Big names like Burberry, Mothercare and Asos are all expected to post strong results in the next few days.
While like for like online growth has slowed to 26.9% (from 41% in September 2009), it is still the key area for high street retailers explains Williams.
“Online retailers don’t necessarily need a shop, but high street retailers certainly need a website now that consumers have grown in confidence when it comes to using the internet,” says Williams. “While the supply and delivery process still isn’t perfect, people are perfectly happy ordering things as big as sofas from the web.
“Chains like Zara and H&M are all online now and Mary Portas recently described the All Saints’ website as more of a brand extension than a simple transactional tool.”
The Retail Bulletin is organising their 2nd Multichannel Summit, to be held in London February 2nd 2011. The event is sponsored by k3 retail and will look at how retailers can maximize profits, market share and loyalty through cost effective, seamless, integrated multichannel strategies.
If you would like to attend as either a delegate or Networking Partner, go to www.retailbulletinconferences.com/multichannel2011
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