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Clothing outperforms retail sector as discounting 'evolves'

Clothing was the best performing retail category last month, as the industry’s discounting practices “evolved”.

Figures published this morning by the British Retail Consortium/KPMG show total sales up 0.6% across all categories, while like-for-likes were down 0.8%. Clothing was ranked as the top sub-sector, followed by footwear.

The BRC noted that excluding Easter distortions, this was the lowest total growth recorded since May 2011.

On a three month weighted average from April to June, non-food like-for-likes are up 3.6% while food is down 2%. In total terms non-food has risen 4.7% compared with a 0.1% rise in food.

The BRC highlighted how some retailers had “mentioned that the mechanics of their summer sales had evolved compared to last year: it was less widespread but involved deeper discounts on a smaller number of products. The aim was not so much to attract footfall than to clear stock of a few leftover products.”

KPMG’s head of retail David McCorquodale said: “These steady sales mean that most fashion retailers have not resorted to the deep discounting we have seen in previous years, and this will help them to hold on to their margins.

BRC director general Helen Dickinson added: “Could it be that [consumers] are feeling a touch more confident and have bought into fashion at full price, which in turn has encouraged some retailers to delay their summer sales? In this case, retailers may find that their margins are less affected than figures would suggest… The recovery is still on track, however, we are detecting differences in attitudes from customers, perhaps led by the competitive environment for food prices. Consumers are delighted to be saving on their food bills, but are prepared to spend a little bit more on discretionary items.”

Readers' comments (1)

  • Completely disagree with KPMG's stance 'Retailers have not resorted to deep discounting' - Really? This is bunker mentality.

    Most retailers have now been discounting for so long they are incapable of doing anything else. We see brands reducing items by 50% what have only been on the shelves a few weeks. Have businesses forgot why they are in business in the first place?

    The clothing trade is for the most part run abysmally and is becoming increasingly like a closed shop.

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