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Fierce competition prompts fresh price cuts in July

Non-food prices fell by 2.2% year-on-year in July, compared to a 2.8% drop in June, according to the British Retail Consortium (BRC) and Nielsen’s shop price index.

Clothing sale

Clothing sale

Clothing sale

Shop prices fell by 1.6% on average, down from 2% in June.

“While we may have become accustomed to prices falling, it’s worth noting that this month’s figures have seen the rate of deflation decelerate,” said Helen Dickinson, chief executive of the BRC. 

“It is too early to say if this is the this is the beginning of the end of sustained price deflation or whether pressures in the wider economy could merely mark the end of the beginning.”

Mike Watkins, head of retailer and business insight at Nielsen, added: “With unpredictable weather and a change to consumer sentiment underway, we have seen retailers cut prices or increase promotional activity in the last few weeks to help top line sales growth, so it`s of no surprise that shop price deflation is lower in July than in any other month this year.

“Once again it is clear there is currently no inflationary pressure coming from retail and discounting looks set to be a catalyst to stimulate demand in the coming months.”

Readers' comments (4)

  • There is inflationary pressure. Buying from abroad has gone up massively owing to exchange rate since Brexit.

    Issue remains: there is over supply. It just means profits are eroding. Never has customer loyalty been so important.

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  • As retailers we should start thinking that consumers are overwhelmed by choice. They will always wait for sales as they know retailers are often offering reductions. Why would they bother buying a new pink handbag that they don't need at full price, when they can wait one or two months for a discount?. In a time where supply exceeds demand, as a consequence of the fast fashion model that every retailer is trying to achieve due to the fact that each business wants to offer constantly new products to a bored and demanding customer. There is no return from here, unless there is a change from a supply driven demand to a consumer one. Less is more but retailers need to change the way they do business...

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  • Retailers need to look at themelves and the continuous ongoing sales they have. Everyone just waits unit the sale starts. Which is now virtually every 2 months. They also need to look at the product they put out. They start off with Champagne, but realise they have lemonade pockets, and all of the sudden product looks the same in every store. No sympathy. Inexperienced buyers who move every 2 years, who dont understand product and dont care about anything other than hitting their department budget.

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  • darren hoggett

    Going on sale = You will fail.

    We have had our best summer in years by continually ignoring how the trade works, having a strict no discount/sale policy, therefore giving the customers what they want, when they want it.

    It works.

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