Retail sales rise in lead up to Christmas

However, BRC warns of more retail administrations in 2012.
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As predicted, the BDO High Street Sales Tracker showed that Christmas falling on a Sunday this year allowed consumers an extra day of shopping, which created a late surge in the fourth week of the month.

Sales were also helped by widespread discounting, similar to that seen in 2008.

Non-store sales surged by nearly a third on the same period in 2010, with figures up by 29 per cent.

Don Williams, national head of retail and wholesale at BDO, said: “Although the year-on-year figures are boosted by weak comparisons due largely to heavy snowfall in December 2010, these results show you can’t keep good shoppers down forever.

“Many retailers made the best use of the tools at their disposal and gave shoppers as many incentives as they could to get them through the door. One hopes the mass discounting hasn’t dented their margins too badly.

“We have again seen that retailers that have embraced and enhanced their multi-channel offer have been able to steal a march on their competitors. However, the year ahead will be tough and we expect some more retail failures in the next quarter, especially of those who have gone through a previous restructuring without really addressing their core product and service offerings, but these figures do show there’s still life on the high street.”

Looking forward though, Deloitte has reported that retail administrations increased from 165 in 2010 to 183 in 2011. The British Retail Consortium (BRC) said this 'shows how trading conditions have toughened'.

The BRC is also warning that more administrations are likely in the coming months, particularly with business rates due to rise by 5.6 per cent in April.

British Retail Consortium Director General, Stephen Robertson, said: “2011 was a tough year with virtually no real terms growth for retailers. In such a competitive sector there will always be businesses that do well while others struggle but seeing such a high number of failures in the final quarter of the year is particularly alarming.

“The next few months are bound to be quieter as consumers rein in spending after Christmas. Retailers are doing their bit by controlling their own costs and keeping prices down for customers despite steep increases in transport and utility bills. The UK’s governments need to support the sector’s efforts to survive, thrive and maintain jobs by holding back the costs for which they are responsible, including business rates, retail levies and the burden of regulation.

“Retailers don’t ask for hand-outs but they do deserve help overcoming some of the barriers to business success. Retail failures leave gaps on our high streets and can result in thousands of job losses. As the private sector’s biggest employer and a major source of jobs for the under 25s, retail needs politicians to recognise the folly of making life harder than it already is.”

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