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Christmas may just delay the inevitable

News that French Connection does not expect its profits to hit last year’s levels will induce a fit of jitters across a high street eagerly looking for signs that this Christmas will be a healthy one for trading.
It’s open to debate how much of that profit warning is down to general trading conditions or problems of French Connection’s own making – it is still trying to win back the hearts, minds and credit cards of those shoppers who abandoned it in the final throes of its FCUK era. But whatever the case, it is not the sort of news that retailers want to see as they enter the crucial final six weeks of the year.

On the plus side, however, the weather has turned colder and, in the short term at least, temperatures will barely limp into double figures. Anecdotal evidence suggests the cold snap has provided a much-needed boost for boots and outerwear (although even when it was unseasonably warm many retailers were reporting strong coat sales, thanks to the new trend-led styles on offer).

Industry watchers are predicting that whatever the weather has in store, and in spite of the credit crunch, consumers will come good and spend what they need to spend to ensure they have a good Christmas, just as they have the previous two years.

All of this is heartening to hear, but as with all silver linings there is a cloud. While the slowdown in trade may not hit before Christmas, those same industry watchers are saying that it is likely to come in January, when retailers both large and small will be faced with a huge challenge to encourage consumers to keep putting emotion before economic logic, and keep on spending.

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