BRC predicts 'more of the same' in 2013

Christmas trading was not exceptional and retailers are likely to be trading in a no-growth environment well into 2013, says the British Retail Consortium.

Commenting on Christmas sales figures, new BRC director general Helen Dickinson said: "Overall, Christmas hasn't been a boom time for UK retailers but it hasn't been complete doom and gloom either.

"There are big variations in individual retail performances but, when the final sums are done, total spending is likely to be up modestly on last year though only broadly in line with shop price inflation.

"As always, there was a last minute Christmas rush. It came later this year because hard-pressed customers remain cautious, wanted to hold out for bargains and there was a final full shopping weekend immediately before Christmas that the calendar didn't provide last year.

"Online sales growth accelerated as we took advantage of the investment that many retailers have made in giving us the flexibility we now demand around delivery options like click-and-collect and security. We now feel much more comfortable about putting our credit card number into our mobile phone, but overall this channel represents just over 10 per cent of total retail sales.

"But, generally, customers bought only similar amounts to last year. Sales were hard-fought and often driven by discounts so cutting into margins, though retailers worked hard to ensure they had the right products available, whether in store or online, and at the right prices.

"Sales have not collapsed but the pressure is coming from adapting to conditions that consistently deliver minimal year-on-year sales growth. There is only so much cost cutting and new efficiency retailers can achieve.

"As we look to the New Year, utility prices are likely to edge up inflation and people are keen to continue paying down their debt, which means the amount of money they have in their pockets will remain under pressure. So, 2013 will be characterised by more of the same and there's every sign that the ongoing endurance test for retailers of trading in a largely no-growth environment is likely to continue well into next year."

Source : The Retail Bulletin
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