Fashion retailers enjoyed an “encouraging” start to the year as the January Sales prompted shoppers to stock up on winter clothing, but warned a return to full price and the introduction of spring lines will be the true test of the market over the coming weeks.
Consumer spending during January rose at its fastest pace for more than a year and a half, up by 2.7%, figures from Visa Europe showed this week.
The report described clothing and footwear businesses as “the real winners” of the month, with sales up 5% year on year, offsetting a 1.2% fall in December.
The British Retail Consortium and KPMG Retail Sales Monitor confirmed the strong performance, recording a 2.6% increase in UK retail sales for the month. It noted a good reaction to clearance in fashion, helped by the colder weather in the first two weeks of the month.
Fashion and footwear retailers told Drapers the positive performance in January was largely driven by discounting, but provided a good platform on which to introduce new season stock.
Anthony Thompson, chief executive of Fat Face, said the retailer enjoyed a “healthy” start to the year, which has carried over into February.
“We went into Sale on Boxing Day and had a healthy January in terms of like-for-likes in stores and online, so a pretty decent start to the year in terms of top-line sales. We came off Sale at the start of February and launched our new spring collection last week and we’re happy with how shoppers are engaging with it, so a good start to this month as well.
“January was very Sale-led for many because there was a lot of stock left from a lacklustre autumn, I think the real test will be the next few weeks as the weather starts to turn and people put their spring collections out, then the industry will see if shoppers continue participating in full price sales.”
Dune founder and executive chairman Daniel Rubin warned there is still an appetite for discounts, but added: ”New season has started well so, all in all, it’s an encouraging start to the year.”
Shaun Wills, chief financial officer of womenswear concessions business Jacques Vert Group, said: “As expected, people came out from Boxing Day onwards to shop for themselves in the Sales and footfall was good through the following month.
“It has been very quiet recently though, and while spring/summer is doing OK, I would say there are still bargain hunters out there seeking out the plentiful promotions on offer.”
The figures from Visa were compiled with business survey firm Markit and reflect overall consumer spending, not just from its card transactions.