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Christmas shoppers bring joy to high street

Multiples and independents have reported better-than-expected sales in December, despite concerns about weak consumer confidence.

Next kicked off the official Christmas trading updates last week, reporting a 15.2% rise in online sales for the nine weeks to 29 December, which helped to offset a 9.2% fall in store sales. Overall, its full-price sales were up 1.5% on the same period in 2017.

However, the retailer lowered its full-year profit guidance by 0.6%, citing high sales of lower-margin seasonal products, such as gifts and beauty, as well as the operational costs of its online sales.

Meanwhile, John Lewis enjoyed a 10.7% surge in fashion sales for the week to 29 December, compared with the same period in 2017. It was due to release a full trading update for the festive season on Thursday, after Drapers went to press. 

On Tuesday, Joules reported that a strong performance online drove an 11.7% rise in retail sales for the seven weeks to 6 January 2019.

The CEO of one contemporary womenswear retailer told Drapers Christmas trading had been “really positive”.

“Full-price sales were very strong, and we’ll end the season with little overstock,” she said. “We didn’t mark down as much this year and customers were looking for newness in store, so [they were] willing to pay full price.”

A London-based fashion entrepreneur said: “The [UK] market is knackered, but at the end of the day people are still going to spend money. Both of my brands did very well and we’re up on the year.”

Several independents also reported an uplift in sales.

Like the multiples, Simon Broadley, owner of East Grinstead boutique Broadley’s, said a slight dip in store sales had been offset by a strong performance online. “Stores were about 6% down on 2017, but we have sold well across our two websites.”

Menswear independent Stuarts London had a strong season after altering its buying strategy to focus on layering. 

Co-owner Ravi Grewal said: “We are up about 25% on last year.

“It was all about the mid-layers. Winter coming later has had a huge impact on what customers want to buy.” 

However, discounting on the high street in the run-up to Christmas has led to fears about the erosion of profit margins. 

Footasylum issued a profit warning this week, blaming the imperative to compete with rivals’ deep discounting.

The footwear retailer warned that full-year revenues and margins would be below expectations, despite a 14% rise in total revenue to £102.3m for the 18 weeks to 29 December. Its online business also performed strongly, up 28% to £36m. 

Follow the Christmas trading updates as they are released by going to drapersonline.com/news

 

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