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Situation ‘critical’ as snow freezes sales

Retailers to promote heavily next week to offset ‘irreversible’ damage to trade.

Retailers are on the brink of pushing the button on unplanned promotions to help claw back millions of pounds worth of sales lost to the winter weather.

Snow across swathes of the country last week brought footfall to a standstill, closed stores and prevented shoppers from venturing outside during the first week of the vital pre-Christmas trading period.

Retailers told Drapers the situation was now “critical” and that sales had been “shocking”. Many said they expected the high street would be forced to promote heavily in a bid to regain what lost revenues they could.

One retail chief executive said: “We’ve all got to make up last week’s lost sales. The snow has killed everybody. The question is, do you liquidate some [stock] now and save margin in January? People will react according to how their stock levels are.”

He added that the current week had been “phenomenal” where there was no snow.

“There is a pent-up recovery this week, but everything is shit in Northern Ireland and Scotland,” he added. “There are massive regional discrepancies. It [becomes] critical now [Wednesday] if the snow does continue. We are never going to make up what we’ve lost.”

One department store boss said: “It’s shocking. Womenswear has dropped off quite a bit. Retailers will go on Sale next week - I think there is going to be a battle going on. I think the customer is holding back. They are discount-driven and they are waiting.

“It became critical on Monday. We’ve got to have a break in the weather, they’ve got to shop at some point.”

Another business chief added that tactical promotions rather than full-blown Sales over the festive trade period would increase, and that all eyes would be on this weekend’s trade before any decision to fire the starting gun on additional markdown activity.

The department store boss added: “I think everyone will go on Sale early. They won’t admit it, but they will. They will do either do it overtly or covertly. We will use the margin we’ve got and promote. I would rather promote with 25% off now than 50% off in two weeks’ time.”

Retailers including Burton, Dorothy Perkins, Evans, Miss Selfridge, Wallis, Debenhams, New Look, Matalan and House of Fraser all had some sort of promotional activity as Drapers went to press.

This week, Debenhams attracted shoppers through its doors by offering 15% off cosmetics and fragrances - a category that is a key footfall driver. Debenhams said the discount level equated to the same as last year’s, but was packaged differently to entice shoppers in.

To compound the misery, this week figures from the British Retail Consortium revealed a surprise fall in womenswear sales in November.

Some retailers told Drapers that womenswear had suffered from a lack of a clear trend.

One supplier said: “Despite a strong dress and outerwear season, jerseywear, whether casual or formal, has not met shoppers’ demands.

“Also, despite outerwear being strong, it is also a bigger-ticket item with a longer lead time, which means that once you’ve taken the money on outerwear, it is hard to repeat quickly, whereas jerseywear has a shorter lead time, so there may be more jerseywear stock out there which is not shifting.”

Tim Bettley, managing director of value chain Peacocks, said: “It’s been a very difficult season for womenswear. There have been one or two key pieces - ankle boots, fur-lined items and shearling - but there hasn’t been one key look or trend. Sales have been quite challenging over the last few months.”

Another retailer disagreed with the figures, but conceded formalwear was tough.

However, it wasn’t all doom and gloom as some etailers such as Shop Direct and Asos recorded their best weeks this year and indies benefited from shoppers staying local due to the snow.

Michelle Birkins, owner of premium womenswear boutique Michelle B in Barrowford, Lancashire, said: “We’re more of a destination shop - the local people seem to come in. With the weather being bad, it stops people from going into Manchester and they shop local.”

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