Pessimistic holiday forecast but leathergoods sell well
According to the latest Distributive Trades Survey (DTS) carried out by the UK’s Confederation of British Industry (CBI) “high street sales are continuing to grow but retailers will need a late Christmas rush if hopes for a strong performance are to materialise”, however, leathergoods and footwear continue to sell well.
Although 38% of respondents in the survey said year-on-year sales volumes rose in the first half of November while 25% said they were down, most retailers expect only modest growth in December. It is believed that the slowdown in sales volumes since the summer is an indication that shoppers are beginning to tighten their belts as the result of five interest rate rises.
On a more positive note, 46% of respondents said their prices during the period (October 30 to November 14) were higher than 12 months ago, while 4% said they were lower. Footwear and leather goods continued to sell well with the balance of +54% of retailers reporting a year-on-year rise as did specialist food sales which increased +35%; however, sales of big ticket items, particularly those linked to the slowing housing market, did not fare so well.
According to the CBI, "Higher energy and food prices have already started to affect manufacturers and wholesalers and now we are seeing the impact on retailers who have been putting up prices over the past quarter. Despite the intense competition in the run-up to Christmas, when we anticipate that retailers who focus on value will do better than the rest, the survey shows that prices are expected to rise again over the next three months.”
